The imposition of tariffs on EU steel has, unsurprisingly, caused a chorus of wailing from the trading partners affected, but most noticeably from the EU. With the EU facing the reality of losing the British contribution (15.35% of the EU budget), they will rely on the wealthy nations to pick up the slack and the extra that they want – for the unwritten rule of EU budgets is that they must be fed and fattened regardless of the cost. In reality this means Germany, and with the German steel industry employing 85,000 workers, the last thing they need is to have the markets for their products shrunk. Trump is a shrewd negotiator, and is demonstrating that he isn’t bluffing by giving the rest of the world a glimpse of the strength of his hand. This is not the start of a trade war, it’s merely a continuation of negotiations, and at the moment he looks like a cat playing with a bird.
The imposition of tariffs has also done nothing to hurt the domestic popularity of the President, with even the New York Times – who make no attempt at impartiality - forced to admit that the economy/ employment figures are a matter of wonder. This has fed through to the Stock Markets, with both the Dow and the S&P continuing to look strong. The FX markets have been more mixed, with the dollar showing its familiar pattern of wins & losses. In this context the conventional wisdom to look for the trends in other markets will serve you well.