U.S. Treasury yields increased amid reports that Trump's tariffs might be narrower, adding optimism among investors.
Market Reaction to Tariff Plans
Reports that President Trump's planned tariffs might be more limited caused U.S. Treasury yields to rise on Tuesday. The Wall Street Journal reported that the tariffs set for April 2 are likely to be narrower and may exclude industry-specific duties, sparking investor optimism.
U.S. Economic Data
The U.S. PMI recorded a reading of 54.3, exceeding February’s 51 and the 51.5 consensus estimate, indicating economic growth. Additionally, S&P CoreLogic Case-Shiller home price data for January and initial jobless claims data are expected later this week.
Fed Forecast Adjustments
The Fed reduced its GDP forecast for the year-end from 2.1% to 1.7%, maintaining its target rate range of 4.25-4.5%. Fed Chair Jerome Powell indicated that policy adjustments might occur based on economic conditions.
Tariff plans remain a focal point, impacting financial markets and Fed decisions, creating uncertainty in U.S. economic outlook.
