Bloomberg Daybreak: Asia Edition Bloomberg Daybreak Weekend: US CPI, Portugal Election, Japan Eco
May 9, 2025
In this discussion, Paul Jackson, Asia EcoGov editor for Bloomberg News, shares essential insights on Japan's economic outlook amidst indicators like GDP and factory output. João Lima, Bloomberg's Portugal bureau chief, dives into the upcoming general election, exploring the contrasting policies of major political parties. Together, they discuss how U.S. economic indicators, trade negotiations, and retail strategies—particularly Walmart's tactics—will influence markets globally. The conversation highlights Japan's unique challenges and Portugal's political landscape as key elements to watch.
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Inflation Above Fed Target
- Inflation in April appears muted but remains above the Fed's 2% target, showing a persistent inflationary pressure.
- This situation implies the Federal Reserve may wait before adjusting rates to observe tariff impacts on the economy.
Tariff Baseline and Inflation Outlook
- Trump aims for a 10% tariff baseline with potential negotiations increasing that to mid-teens, up from previous 2.5% levels.
- Economists forecast inflation rising to 3.5% by Q4, possibly keeping the Fed on hold through 2025 unless labor weakens.
Retail Sales Volatility
- Retail sales surged 1.4% in March due to pre-tariff buying rush, but April is expected to see flat or only modest growth.
- This variability signals consumer demand might have been pulled forward, complicating economic readings.