Global News Summary 24-29 March 2025

United States

• The "American exceptionalism" narrative faltered as US equities and the dollar experienced sustained selloffs due to tariff anxiety and economic uncertainty.

• Trump’s trade escalation continued with:

  • A proposed 25% tariff on countries purchasing Venezuelan oil.

  • New auto import tariffs set to begin 2 April, sparking global trade retaliation threats.

  • 70+ Chinese entities blacklisted, targeting AI chip and weapons technology.

• Consumer confidence plunged: Conference Board index dropped 7.2 points to 92.9, and long-term inflation expectations surged to the highest in 32 years.

• Equities slumped: S&P 500 fell 2.0% on 29 March; Nasdaq Composite declined 2.7%, completing its worst quarter since 2022.

• Safe-haven demand lifted bonds: 10-year Treasury yield fell 10 bps to 4.26%.

Canada

• PM Mark Carney confirmed federal elections for 28 April.

• Carney warned that Canada’s traditional trade relationship with the US is “over”, vowing a broad renegotiation.

• Ontario introduced a 25% surcharge on US electricity exports, affecting over 1.5 million US homes and businesses.

• Canadian dollar remained stable amid election-related uncertainty.

United Kingdom

• Chancellor Reeves launched a £14 billion fiscal plan, including £4.8bn in welfare cuts, to address strained public finances.

• S&P Global PMI rose to a six-month high of 52, signalling tentative growth after prior stagnation.

• February CPI slowed to 2.8% (from 3%), boosting the case for rate cuts in May.

• Defence budget to allocate 10% to AI and drone technologies, aimed at rejuvenating local industry.

• UK engaged in urgent talks with the US to avoid incoming auto tariffs.

Eurozone

• EU prepared retaliatory tariffs on US services, particularly targeting Big Tech, in response to Washington's 25% auto tariffs.

• Germany's Ifo expectations index rose to 87.7, reflecting optimism from Merz's impending infrastructure investments.

• EU leaders highlighted trade and security risks from Trump’s America First policy, signalling deeper intra-European cooperation on defence and fiscal integration.

Japan

• Tokyo CPI rose 2.4% YoY in March, exceeding expectations (cons: 2.2%), keeping the BOJ’s tightening path intact.

• Yen strengthened (↑ 0.9%) to 149.75/USD due to safe-haven demand amid global equity selloff.

• PM Ishiba criticised Trump's auto tariffs, threatening countermeasures and reaffirming Japan’s $1 trillion US investment commitment.

China

• China pledged to prepare for "unexpected shocks", pushing for multilateralism and globalisation as tariff tensions escalated.

• Joint Japan–China economic dialogue discussed de-escalating regional trade frictions.

• 25% retaliatory tariffs on US goods took effect; Beijing criticised tech export bans.

• Economic data showed resilience:

  • Retail sales rose 4% YoY (Jan–Feb).

  • Inflation dipped below zero, reflecting deflationary pressure.

Australia

• PM Albanese’s government unveiled a pre-election budget with A$1.8 billion in electricity rebates and a budget deficit of A$42.1bn (1.5% of GDP).

• Inflation edged lower to 2.4% in February, reinforcing rate cut expectations.

Economic Growth

• Global growth sentiment deteriorated amid trade war fears:

  • US GDP forecast slashed to 1.7% by the Fed.

  • German industrial optimism surged on anticipated infrastructure boost.

  • Spain’s central bank projected 2.7% growth, down from 3.5% in 2024.

  • Australian government remained confident despite fiscal slippage.

Jobs

• No major job reports released; however:

  • UK average earnings held firm at 5.9% YoY.

  • US job sentiment weakened, per consumer data.

  • Japan's labour outlook firmed as inflation and wages stayed elevated.

Debt Securities

• Bond yields dropped globally:

  • US 10Y: ↓ to 4.26%,

  • UK 10Y Gilt: ↓ to 4.69%,

  • German Bund: ↓ to 2.73%.

• Strong demand seen in EU and UK bond auctions, reflecting investor risk aversion.

Artificial Intelligence (AI)

• OpenAI neared a $40 billion funding round led by SoftBank and major US funds.

• Alibaba released a multimodal Qwen AI model capable of running on consumer devices.

• EU lawmakers resisted attempts to weaken the AI Act, warning against voluntary compliance for Big Tech.

• UK’s tech minister defended new AI copyright rules, facing backlash from creatives.

• Ant Group & Huawei reported a 20% cost saving in AI training using domestic chips and Mixture-of-Experts models.

• CoreWeave slashed its IPO size from $4bn to $1.5bn, amid cooling enthusiasm for AI infrastructure.

ESG

• ESG-specific developments were muted this week, though gold’s surge above $3,000/oz was partly driven by investor hedging against inflation and global instability, often tied to ESG and sustainable wealth themes.

Inflation

• US long-term inflation expectations surged to highest in 32 years.

• UK CPI eased to 2.8%.

• Australia CPI fell to 2.4%, opening door for RBA rate cuts.

• Japan’s CPI (Tokyo excl. fresh food) was +2.4% YoY in March.

Recession Risks

• Rising inflation + weakening consumption in the US sparked stagflation concerns.

• Fed’s Goolsbee warned bond market pricing in higher inflation would be a “major red flag”.

• Equities finished their worst quarter since 2022, suggesting investor pessimism may persist.