Muted reaction to Trump’s tariffs

There has been a muted enough market reaction to the news that Trump has actually gone ahead and raised the tariff on $200bn worth of US goods imports from China, though the damage had already been done through the course of this week. Asian equities are flat to higher overnight, having fallen in recent trading sessions; after recent losses, European stocks have opened in positive territory this morning; and core bond yields are steady, but still lower on the week overall. The major currencies have been largely unaffected this week, and this remains the case this morning, with the euro still hovering around the $1.12 level against the dollar. Sterling has nudged lower over the past few days, for reasons related to UK domestic politics as much as anything else, and is trading at 86.25p and $1.30 against the euro and dollar respectively

There has been some more positive economic data out of Germany this morning as exports rebound in March, increasing by 1.5% m/m and more than reversing February’s fall

GDP data due in the UK this morning are expected to show the pace of growth picked up in the first quarter of this year, to 0.5% q/q according to the consensus forecast from 0.2% in the final quarter of 2018. Some of this may reflect firms building up stocks as fears of a ‘no deal’ Brexit took hold, and so growth may moderate again in the second quarter

Other day scheduled for today includes CPI inflation in the US. The consensus expects the headline rate to have picked up for a second consecutive month in April – to 2.1% from 1.9% in March and 1.5% in February – reflecting the impact of rising oil prices recently