Tariffs may not “solve” everything

Daily update

Japan’s December trade data had weaker imports and stronger exports than had been expected. Exports to the US declined, which rather argues against pre-trade tax stockpiling in the US (though there may still be time for that). The absence of stockpiling would likely speed the impact of trade taxes on US consumers.
UK corporate sentiment data is due from the CBI trends survey. Companies might possibly express pessimism as a means of registering their opposition to the UK government’s recent moderate tax increases on the corporate sector.
US initial jobless claims data is likely to start to be affected by the California fires. Of course, given the demographic of LA County many people may be able to work remotely. However, service sector workers serving the inhabitants of the area are at risk of unemployment.
US President Trump threatened to tax US consumers of Russian goods if Russian President Putin did not start negotiating an end to Russia’s war against Ukraine. This may revise investors’ expectations about a possible ceasefire as it seems a weaker policy than Trump’s earlier statements implied. There are few US consumers of Russian goods. Sanctions against Russia might have more impact, but the effectiveness of sanctions tends to decay over time.