Steno Signals #198 – A 20–25% Weaker USD May Solve All Trump’s Problems

537 Views27 May 2025 13:58

SUMMARY

Morning from Europe.
Trump’s classical stop-and-go approach to negotiations is starting to get baked into markets, but we’re still surprised by the extent of market moves when these impulsive threats are announced on Truth Social — and markets remain poor at assessing the “realistic outcomes” of this approach.
On Friday, markets at one point priced in a 40–60% probability that 50% tariffs on the EU would actually take effect on June 1.

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