Financial markets remain positive despite uncertainty in the US regarding interest rates

IN THE US, the “backlash” from the Trump administration's tariff policies is starting to affect the US economy and financial markets quite negatively.

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The Federal Reserve's Open Market Committee (FOMC) announced at its meeting on 7 May that it would not decrease its bank rate. The US central bank has warned that President Donald Trump's tariffs have created "so much uncertainty" that it is unsure what to do about interest rates.

The Federal Reserve announced on Wednesday that it would keep interest rates unchanged, despite pressure from Trump to lower borrowing costs. Fed Chair Jerome Powell stated that the economic fallout from Trump’ tariffs meant it was "not at all clear" what the bank should do next.

US share markets managed to remain nervous and undecided on Friday as investors assessed fresh comments from President Donald Trump regarding tariffs on China ahead of a key weekend meeting between the two countries.

Trump argues that Beijing should open its market to the US and feels that 80% tariffs on Chinese goods "seems right." The levies are currently at 145%. One can only assume that a comprehensive deal is unlikely to emerge from a single meeting.