Markets on Edge: Trade Wars, Tax Plans & Global Economic Shifts

This week was marked by uncertainty in the markets, mixed employment data and new tax proposals from President Donald Trump. On Monday, markets reacted negatively following Trump's executive order imposing tariffs of 25% on Mexico and Canada and 10% on China. However, the president postponed the tariffs on Mexico and Canada for 30 days after negotiating with their leaders. The Asian giant did not receive the same treatment and responded with 15% tariffs on $40 billion in U.S. imports, in addition to antitrust investigations against technology companies, including Alphabet, thus starting a new chapter in the trade war between the two nations. On the economic front, employment data sent mixed signals. In January, nonfarm payrolls increased by only 143,000, below the 169,000 expected, but wages grew by a solid 0.5% and the unemployment rate fell to 4%. In addition, jobs from the previous two months were revised up by 100,000, and average monthly job growth was adjusted to 166,000. These data reinforce the expectation that the Federal Reserve will keep its monetary policy unchanged in the near term.

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