David McNamara: Markets have found the pain threshold for the US

While the tariffs U-turn is something of a reprieve for now, European trade partners have little certainty on eventual US trade policy

The U-turn is a reprieve for now but the clock ticks for a further 90 days.

Following a tumultuous week on financial markets, with US President Donald Trump unwinding some tariff measures and ratcheting up others, uncertainty abounds, with little clarity on the future path of policy. However, the volte face from Trump in introducing a 90-day pause on some tariffs suggests the markets have found the pain threshold for the US administration and have potentially set a guardrail on future policy.

To recap, a simultaneous sell-off in riskier assets (US stocks) and supposedly safe-haven assets (US treasuries), alongside a depreciation in the dollar, brought markets to a precipice of a potential contagion event.