Investing.com -- The uncertainty surrounding U.S. trade policy may have already peaked, according to Macquarie strategistss, who see a shift toward greater stability following the appointment of the new U.S. Trade Representative.
"With the new U.S. Trade Representative Jamieson Greer taking office yesterday, there is renewed hope that there will be more regularization and rationalization of the U.S. administration’s import tariff policies and program, as well as an impetus for more negotiation with trade partners," the firm noted.
Macquarie now believes that "peak chaos" with regard to tariff policy is behind us.
It comes after months of heightened uncertainty, with shifting trade policies impacting global markets.
They believe the expectation of more structured negotiations could help ease investor concerns and stabilize supply chains that have been disrupted by tariff uncertainty.
Elsewhere in the note, and beyond trade, Macquarie also highlighted concerns over Brazil’s economic trajectory, particularly regarding its fiscal targets.
"We think that worries about whether Brazil will achieve its 0.0% primary deficit target in 2025 or 0.25% in 2026 (an election year) will persist, despite promises made by the government," analysts wrote.
They cited lower growth and eroding terms of trade as key risks that could weigh on sentiment. The Brazilian real (BRL) is expected to weaken, with Macquarie forecasting USD/BRL rising toward 6.30 near year-end.
On the European front, Macquarie pointed to Germany’s upcoming fiscal reform vote as a potential turning point, with expectations that increased borrowing could spur economic growth.
The firm believes this dynamic signals a fading of ‘American exceptionalism’ that dominated in late 2024, potentially leading to a stronger euro and British pound in the medium term.