9 April 2025 US Monitor Using tariff revenue to cut taxes would offset little of the wider damage

• Tariff-funded tax cuts would simply give with one hand while taking more with the other.
• The net federal revenue available is likely to be just $200B, after accounting for the weaker economy.
• We look for a below-consensus 0.2% rise in the March core CPI; it’s too soon to see impact of China tariffs

8 April 2025 US Monitor Rules of thumb to navigate through the tariff crisis

• Recent falls in oil prices and shipping costs will offset about one quarter of the tariff boost to inflation.
• The $10 fall in WTI oil prices, however, also points to a 0.1% hit to GDP via lower business investment.
• The fall in financial wealth is consistent with households’ spending undershooting its trend by 0.7%.

PM Datanote: US Employment, March

Healthcare driving payroll growth again; ongoing support will offset some tariff damage.

PM Datanote: US ISM Services Survey, March

Weak, but far from definitive.

7 April 2025 US Monitor Payroll growth will slow, but it's too strong for the Fed to ease in May

• The stock price drawdown is historically consistent with a 1% fall in payrolls, but slow gains are more likely.
• Most services firms have little exposure to tariffs; leading indicators of hiring are weak, not on the floor.
• The healthcare sector will remain a jobs juggernaut; falling manufacturing payrolls will drag modestly.

PM Datanote: US ADP Employment, March

ADP distracts more than it informs.

4 April 2025 US Monitor Stagnation in GDP is now our base case, after the tariff shock

• The average effective tariff rate will jump to 22%, from 3%, if Mr. Trump follows through on his plans.
• We now look for a tariff uplift to the core PCE deflator of about 1¼%, half a point more than our prior assumption.
• The outlook for capex and exports is worse too, but fiscal and monetary policy can offset some damage.

PM Datanote: US ISM Manufacturing Survey, March

Tariff uncertainty is weighing on manufacturing.

3 April 2025 US Monitor Break-even payroll growth likely has stepped down, but only modestly

• Border Patrol encounters have fallen to zero, but unauthorized immigration likely will rebound soon.
• ICE arrests have risen only slightly; the hit to labor force growth so far is modest.
• A shrinking wage growth premium for job switchers suggests lower core services inflation ahead. 

1 April 2025 US Monitor Payroll growth likely slowed in March, but to a better-than-recession pace

• Headline payrolls likely rose about 140K in March, with private payrolls up by roughly 125K.
• Ignore the upbeat NFIB survey; Conference Board, Indeed and regional Fed data point to a slowdown.
• Continuing claims data point to a stable unemployment rate, but WARN filings point to a rise ahead.