Read the highlights of this week’s commentary from Helios:
- President Trump announced a 90-day pause on reciprocal tariffs, keeping the 10% baseline rate in place while raising tariffs on Chinese goods to 145%. China quickly retaliated, raising tariffs on US imports from 84% to 125%, effective April 12. Despite the pause, the average US tariff rate remains historically high at 26.25%. Economists caution that prolonged tariffs could disrupt global trade, increase inflation, and raise the risk of recession.
- The March consumer price index (CPI) fell 0.1%, marking the first monthly decline since 2020. Gas and airfare prices dropped sharply, but grocery and housing costs rose. Annual inflation slowed to 2.4%, though some experts warn this slowdown may be temporary, as recent tariffs could drive higher inflation by the May CPI report.
- Bond yields surged this week, with the 10-year rising above 4.5% and the 30-year approaching 5% – the biggest spikes in decades. Investors sold off Treasuries amid concerns about inflation, rising deficits, and weaker foreign demand. This pushed borrowing costs higher and rattled markets, with some pointing to uncertainty around the Fed, global rate changes, and even questions about the future of the dollar’s reserve-currency status.
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