Midweek Macro Note: Fiscal Put Firepower, Range Bound, Tariff Macro Impacts, Japanese Connections, Vision Note, and More

In this Midweek Macro Note - the MacroEdge Team dives into the latest tariff comments, hard data, charts, and more - while the Vision note provides clarity during this cloudy time.

Midweek Macro Note - April 23, 2025 (@DonMiami3, MacroEdge Chief Economist)

Good Wednesday evening MacroEdge Readers & Community, 

This Wednesday evening we’ll dive into some of the latest data & charts for the week - and look ahead to what we have for the rest of the week. It’s been an extremely noisy last few days with 12 people in the administration saying different things just about every other hour. On the tariff front - the headline today about a potential Chinese tariff getting reduced spiked markets in the morning - and some of that abated as the Press Sec. came out and said that there were no change to the Chinese tariffs - things cooled off for the remainder of the day. It was a pretty average volume day for the last month - and the broader pattern still looks like distribution to a degree - with no outlier volume days driven by positive macro or intervention forces - given that we’ve been range bound since Trump announced a 90 day pause on the tariffs back on April 9th (we discuss and chart that below for you). 

Given all of this noise - we’ll navigate it below in my latest comments & in the Vision note from Six. 

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It Still Seems Off

The discombulation of the last few days has been eye opening for a lot of our customers & clients - and people are really scratching their heads asking ‘what is the end game here?’. With the 10Y back up to 4.4 today - picking back it’s morning sell-off - with ease - it really is just becoming a confusing circus. In my opinion, the whole thing seems off… There’s a lot of competing forces at play now and there is real macro damage being done - in hard, not soft data - and it remains to be seen if the damage done thus far can be abated later in the year or not. Bessent says one thing, Lutnick says another, Navarro is in the background saying something else, Hasset says 3+3=7, and today the whole presser was bizarre with Trump essentially being unplugged from talking – seems like a third party is in control of the situation for the time being. 

Zoom Out 

In the context of a lot of the noise over the past few weeks - I note that the major equity markets have been flat since the first Yen Carry Trade blowup in July/August of 2024. That kicked off central bank interventions - particularly in Japan - and we’ve been tethered to price movements on the Nikkei & USD/JPY since then. That remains in the case and I think Bessent may struggle at this point to contain a stronger Yen if the BoJ continues its (even delayed) course to increase rates another instance this year.