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This is the Bloomberg Day baker At podcast, available every morning on Apple, Spotify or whatever you listen. It's Tuesday, the twenty second of April. Here in London. I'm Caroline Hipkot and.
I'm Stephen Carroll.
Coming up today, Donald Trump demands an immediate rate cut from Fed charge Jerome Powell as investors flee US docs, bonds and the dollar amid growing Sell America momentum a.
Two trillion dollar tariff hit. Bloomberg crunches the numbers on the cost of the US president's global.
Levies plus the art of the deal.
Rachel Reeves vows to put the UK front and center as she prepares for face to face talks with her US counterpart, Scott Bessant.
Let's start with the roundup of our top stories.
US markets have sold off amid renewed attacks from President Trump on Federal Reserve charg Jerome Powell. In his latest broadside against the central Bank, Chief Trump warned the economy could slow unless quote mister too late, a major loser lower's interest rates.
Now.
Bloomberg reports that Trump has privately questioned advisors about the possibility of removing Powell, though some administration officials have cautioned him against such a move. Economists widely expect Trump's tariffs to boost inflation and slow growth, even if just temporarily. Former Federal Reserve economists Claudia Sam says markets need to be alive to the possibility of the White House trying to remove Powell.
I take it very seriously, and I you know, this administration has taken steps, whether it's with the tariffs or with downsides in the government that really were, you know, beyond expectations. So I you know, the unthinkable is thinkable with this administration.
Thadia Sam, speaking there after Federal Reserve Charge your own. Powell again stressed last week that the Center Bank must ensure tariffs don't trigger a more persistent rise in inflation.
Trump's escalating frustration with the Fed chair has triggered a broad fly from US stocks, bonds, and the dollar has traders grow increasingly uneasy with the administration's policy approach. A key gauge of the greenback is on track for a fourth straight day of losses as sentiment on Wall Street shifts from optimism to what some are calling a cell America mood. Apollos Chief economist Torston Slock says the US economy is facing an ever growing list of headwinds.
It's just not only terms and retaliation, which of course are the most important ones. It's also corporate confidence is very low. The Conference Board measures and also the CEO index measure from various sources and CFO measures going lower.
KAPEX plans are also grinding lower.
Literally for the last two months, and because of course, consumer confidence is also at the lowest level.
Literally in decades.
Apollos Chief economists Torston Slock speaking there as investors continue to pile into gold amid increasing market uncertainty. The precious metal has now hit yet another code, topping three four hundred and forty four dollars an ounce following a two point nine percent search on non day.
Donald Trump's trade tariffs and it's the beginning of April, will shave about two trillion dollars off the global economy by the end of twenty twenty seven, according to a new estimate from Bloomberg Economics. The effects of the trade war hanging over the world's economic leaders as they gather of the IMF and World Bank Spring meetings in Washington, Saxo Banks Chief Investments strass Charity Sanana says, the shape of the shock is still unclear.
Will it be a growth shock, will it be an inflation shock? So some kind of an he went driven you know issues maybe resulting in a kind of a cyclical issue, some kind of a recession or a saculation, whatever.
It might be.
But now we're just mophing it into a structural one, you know, with the kind of questions that it raises on the credibility you know of the US and usc.
ASCID Saxo Banks Chief Investment Strategies Charity Sanana, there the tariff moves that brought into question US economic answer, security leadership, and the multilateral rules based system symbolized by institutions like the International Monetary Fund.
Many leaders will be using the IMF gathering as an opportunity for trade talks with the US government. UK Chancellor Rachel Reeves is one of the finance ministers flying to Washington to make the case for free trade. She's expected to meet with US Treasury Secretary Scottan Bessen for the first time there.
The United States has announced new tariffs on solar panel imports from Cambodia, Vietnam, Malaysia and Thailand. The levies could be more than three thousand, five hundred percent the culmination of a trade probe started by former President Joe Biden. Many Chinese manufacturers had set up operations in Southeast Asia after they were hit by similar tariffs twelve years ago. The tariffs are likely to boost US domestic manufacturing but increase the cost of ramping up renewable energy production.
To other news, a paper conclave is now due to decide on Pope France's successor after he passed away on Eastern Monday. The College of Cardinals will meet in about two weeks time, when around one hundred and thirty five members will cast their vote. Amongst those traveling to Rome for the proceedings will be the Archbishop of Westminster, Cardinal Vincent Nichols, who says that Francis will be remembered fondly his.
Commitment to the individual and to the people on the edges of society, who is unquestioned, but he also fashioned that in a way directed to those who hold the power and generate the world.
The Archbishop of Westminster, speaking there, the election could threaten what Pope France's supporters see as his legacy as a reforming pope if a more conservative candidate is chosen and moves the Church away from his positions on issues such as LGBTQ rights.
American, European and Ukrainian officials are due to hold talks in London tomorrow as the White House pushes for a deal to hold Russia's invasion, whom We're understands. The US ecritaristic Marco Rubio and special envoys are expected to meet foreign ministers and advisors from France, Germany, the UK and Ukraine. The gathering is intended as a follow up to meetings in Paris last week, where the US shared proposals to enable a ceasefire and peace agreement between Russia and Ukraine.
Those are top stories for you this morning. Let's look at the markets at the Bloomberg Dollar Spot index losing ground again for a fourth day in a row. There had been some early gains, but those seem to have evaporated. The Bloomberg Dollar spot indexes currently down a tenth of one percent, the yenner one hundred and forty handle, the euro edging higher about a tenth almost two tenths of one percent this morning US stock futures are actually in the green after the plunge that we saw on Monday.
Asian equities and mixed Chinese tech shares drifting in Hong Kong this as we see the Topics Index upper tenth and the Nikky slightly lower this morning. As for oil prices, WTI crud futures climbing one percent this on. In gold up one point seven percent, so we're actually approaching the thirty five hundred dollar mark four hundred and eighty two, and looking at the bond market as tenny USC is at four forty three, up by two basis points. Those are the markets.
In a moment, we'll bring you more on the pressure on Jerown Powell. Plus Rachel Reeves heads to Washington for those IMF and World Bank meetings in the shadow of Trump's tariffs.
But another story that we've caught our eye this morning.
The author Rachel Gisa has been writing for BusinessWeek about a topic that she's written a book about as well.
But this is to do with the title is.
Building a Better Man of Sphere, but something that's being reflected on as the particularly masculine approach to policy that's been taken under the Trump administration.
Yeah, sort of hyper aggressive manhood, but not the sort of masculine world let's say Ronald Reagan where it's kind of tough sheriffs, that sort of part of Familia's type of world that Rachel describes. In fact, she talks about the men in the inner circle of Donald Trump, Elon Musk and JD. Vance and Mark Rubio and Pete Hegser than others not being actually in the kind of traditional American archetypal sort of mode, but actually forming this kind
of insecure model of masculinity. She says that the manuscript online doesn't have to be like that, that there could be a kind of another another way, and she brings out some really interesting statistics that for example, Goat, which is a research firm, finds that young men in the US a quarter of them follow fashion influencers, thirty percent
are into film and theater and acting. So that there could be a kind of much broader Internet that you could respond to young men's desires for that connection.
It's not that the Internet as bad, articles that there are bad parts of the Internet, and perhaps what we need to be able to do is support boys and young men in I suppose finding the diversity that's out there as well, rather than necessarily falling into.
Some of the murkier part of it. But it's a really interesting reader.
You'll find it at Bloomberg dot com and on the terminal, and if you're listening to the Bloomberg Daybreak You're a podcast, you'll find a link to the article in our show notes.
Now to the markets we have seen world swings or markets as traders face a new source of uncertainty? Will Donald Trump tie to removed your own Powell as the chair of the Federal Reserve?
Butlin a big opinion.
Columist Daniel mos Jones is now to discuss, Daniel, Good Morning, how precarious do we think Powell's position is now?
I want to go back to a remark that Claudia sam made on air just a few minutes ago. She says, it's a very real possibility. I agree, it certainly is a possibility. Now does that make it a probability? I
don't know. If you look at the way markets have behaved since Thursday morning, US time, when Trump resumed his threats to get rid of Powell, it's that there's been in abeyance for a little while the reaction has been a swift and punishing so as the folks at ISI ever Core have asked, if you liked the market reaction to the tariffs, get ready for something very special In the event, Powell is dismissed.
In context of central bank independence, though, is there's a bigger thrast than what we've seen before. It's not the first time we've heard, but it's got crestsism of central bankers.
Trump has been the first president in some decades to openly take on the FED. What we tend to forget is prior to the Clinton administration this was very widespread. One of the things that Bob Ruben imposed on the Clinton white House was we don't criticize the FED the otherwise we believe in a strong ballot or so much for that one. You know, Look, central banking history is full of anecdotes about pressure that people like Richard Nixon,
like Lyndon Johnson, like others brought to bear. There was a wartime monetary policy that existed under FDR and Harry Truman. In Asia, central bank independence is slightly less tootemic, but it is questioned. Nonetheless, serious questions have arisen about independence in Indonesia, in Thailand, and in New Zealand, which rolled out the model of a modern central bank in nineteen ninety. The government has really done some things to bring the bank to heal. So look, this is not God given. Okay.
If you look at the US Constitution actually says nothing about the Federal Reserve. Congress has delegated the power to set monetary policy to the Federal Reserve. And I'll just one other thing. I'm not defending Trump. Political pressure on the FED has historically been misunderstood. Certainly the decade I spint in Washington, the thing the FED worried about the most was political approsure from the Congress and changes to the Federal Reserve Act.
Okay, Daniel, thank you so much for being with us this morning, Blueberg opinion columnist Daniel Moss. And yet, of course the markets are concerned about this. A lot of our opinion writers, including Daniel, have got pieces on the Blueberg terminal for you, including John Authors about the worries of what it would do immediately to markets werepal.
To be dismissed.
Well, the UK's chancer Rachel Reeves is in Washington this week for the International Monetary Fund and World Bank Spring meetings. She'll be meeting with the US Treasury secretaries, got best and to push for a UK US trade deal. Our UK correspondent Lizzie Burden is here with us to help us look ahead to that. Lizzie, the world is staring into a trade war, abyss. The IMF will release its new economic forecasts today.
What should we.
Expect, Well, it's set to lower its outlook for growth today. And remember but the IMF's projections actually later on tend to have proved optimistic about crises when you look back. So whatever they say today, the is going to be the impact of tariffs. The reality is likely to be
a lot worse. But this, of course is going on just a few blocks from the White House, and this is the first gathering of all of these ministers in the US capital since Donald Trump's inauguration as US President in January, so that adds another edge to these discussions.
What's Reeve's hoping to get from the trip though, in particular, there is also the trade deal and the UK's relationship with China. Reeves was talking only a few days ago about cutting ties with China would be foolish.
Yeah, if I can thread all those things together. So she's going to be lobbying the US Trade Secretary, Treasury Secretary Scott best Sent for a trade deal. You had Donald Trump and Keir Starmer speaking on Friday. Officials though trying to temper expectations about what Reeves can get out of best Sent this week. It's really about improving the mood music for now. But this is her first time
meeting him in person. Now he's seen here in London as one of the less hard line voices in the Trump administration and the focus of ministers and the UK ambassador to Washington, Peter Mandelson, Lord Mandelson, is very much to persuade Donald Trump to try and cut his twenty five percent global tariff on car and steel imports, and as you say, also to get a trade deal. Now, Reeves's team of stress that the UK is not just going to give away anything to get that trade deal
over the line. They might be prepared to cut the Digital services tax, which of course hits US tech companies. They may cut tariffs on some US meat and seafood exports, but Kirstarmer, the Prime Minister, has ruled out relaxing food safety standards because of course there are huge fears about chlorinated chicken and hormone hormone fed beef here in the UK. It would send the UK newspapers absolutely mad if those things gone over the line, and it could jeopardize closer
ties with the EU. And remember Kirstarmer on May the nineteen is hosting this UK EU summit to reset trade and security ties post Brexit. Then there's the China element, and as you say, Rachel Reeve's telling the Telegraph newspaper over the weekend that it'd be foolish to buckle to Donald Trump's pressure to limit the UK's dealings with China. So a lot of plates to spin for the team in Washington this week.
But perhaps also a chance for Rachel Reeves to get away from some of the big fiscal questions that are persisting at home. Already speculation over what she might do in the next budget.
Yeah, it has been a theme for this labor government to focus on the perhaps easier, could you believe it, international picture than what's going on at home. We know that she's so fiscally strained, but she has pledged that she is not interested in a wealth tax at the upcoming autumn budget. She says that the capital gains tax changes that they made last autumn are pretty much where
they need to be. But of course we know that she only left the same amount of headroom as she did last autumn nine point nine billion pounds, so there's lots of splation about tax rises and she's ruled out breaking her fiscal rules, so it only leaves spending cuts off that her cream vanishes again.
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