In today’s briefing:
- UK: Spillover effects from US tariffs
- Trump, Tariffs, and Trade Wars
- Europe Vs NATO & Trump – U/W Bonds
- Bond Market Monitor: TRUMPolined Recession
- CX Daily: Trump Tariffs Put Global Trade System in Crisis as Countries Retaliate
- Paetongtarn’s Parliamentary Win of Little Help to Struggling Economy
- Macro Bite – India : Why RBI Should Cut Fast and Deep
- Global base oils arb outlook: Week of 7 April
- Global base oils margins outlook: Week of 7 April
- Asia base oils supply outlook: Week of 7 April

UK: Spillover effects from US tariffs
- The UK output destroyed by reciprocal US tariffs is only partly due to the direct impact of the new 10% rate (worth ~0.2% of GDP) and generally weaker US prospects (0.1%).
- Global GDP growth is depressed by this policy, indirectly destroying demand for UK exports from elsewhere (0.2%), especially if countries harm themselves by retaliating.
- An overall 0.6% GDP hit has two-sided risks and a skew lowered by likely negotiations. Fears of items dumping into the UK market are overblown excuses for protectionism.
Trump, Tariffs, and Trade Wars
- President Trump’s radical tariff measures will usher in a new era of greater volatility, slower growth, financial stresses and geopolitical downsides.
- The coming weeks will be marked by uncertainty as the domestic political pushback in the US interacts unpredictably with retaliation by trading partners and the economic fallout.
- In Asia, monetary easing can mitigate only part of the impact. Fiscal policy is needed but is constrained in most of the region, given pre-existing debt and deficits.
Europe Vs NATO & Trump – U/W Bonds
- Bond holders should be concerned about Europe’s fiscal position, which is less rosy than official numbers suggest, and the looming surge in defence spending. Stay underweight European government bonds.
- Europe’s urgently needs to strengthen its defences. There is some catching up to do – Europe still spends half as much as the US’s and the gap has widened.
- Weaning itself off US arms won’t be easy or quick. Overweight US defence stocks.
Bond Market Monitor: TRUMPolined Recession
- President Trump’s announcement of tariffs stunned the market and warrants our pessimism on the US economy.
- One of the worst policy blunders in our lifetime should help put the US into a recession this year
- We recommend a long position in short-rated and variable rate bonds as well as precious metals such as gold.
CX Daily: Trump Tariffs Put Global Trade System in Crisis as Countries Retaliate
- Tariffs / Cover Story: Trump tariffs put global trade system in crisis as countries retaliate and stock markets plummet
- Legal battle /In Depth: How one acre in Shanghai sparked a 20-year legal battle
- Stocks /: China markets sink as trade war intensifies
Paetongtarn’s Parliamentary Win of Little Help to Struggling Economy
- The Thai prime minister comfortably survived a vote of no confidence, suggesting that the marriage of convenience holding her coalition government together is still viable for now
- The parties in the coalition, however, are still engaged in power struggles, causing political and policy instability as well as impede coherent policy for the rest of the term
- Distracted as it thus is, the government is not well-placed to address the challenges emanating from a more hostile trade environment and weakening domestic fundamentals
Macro Bite – India : Why RBI Should Cut Fast and Deep
- Downside growth risks dominate following the sweeping tariffs announced by the US, which is India’s largest export partner
- Negative impact on labour-intensive exports will disproportionately hurt overall GDP growth
- Growth will be best supported by large and frontloaded rate cuts
Global base oils arb outlook: Week of 7 April
- US Group II base oils export price-discount to CFR India prices widens further through March 2025 even ahead of imposition of US tariffs and slump in crude oil prices.
- US Group I brightstock export price flips to rare discount to CFR India price in recent weeks.
- Ongoing weakness of US export prices points to weaker-than-usual domestic demand.
Global base oils margins outlook: Week of 7 April
- Global base oils prices face growing upward pressure versus feedstock/diesel prices following slump in crude oil prices.
- Firming base oils premium points to tightening supply and rising demand, incentivizing refiners to maintain or raise output.
- Recent slump in crude oil prices reflects concern about slowdown in global economic activity and subsequent drop in demand.
Asia base oils supply outlook: Week of 7 April
- Asia’s base oils prices resume rise versus feedstock/gasoil prices.
- Rising margins point to still-firm supply-demand fundamentals at start of Q2 2025.
- That dynamic could change in coming weeks if economic growth slows, compounding typical seasonal dip in demand from end of second quarter.