Aurelia Butler

Unlock the Editor’s Digest for freeRoula Khalaf, Editor of the FT, selects her favourite stories in this weekly newsletter.One of the world’s biggest toymakers, which supplies retailers including Walmart and Target, plans to move all US-bound production away from China and warned that tariffs meant American consumers would “inevitably” end up paying more for toys. Allan Wong, chair and chief executive of Hong Kong-based VTech, said on Wednesday that the toy maker was “aiming to complete the transfer of its production of US-bound products away from China” before the end of next year. VTech, which specialises in educational toys, plans to shift production to its factories in Malaysia, Mexico and Germany, Wong said at a press conference. The toy maker is pressing ahead with plans to re-engineer its supply chain despite a truce between Washington and Beijing, which has resulted in the US cutting tariffs on Chinese goods from 145 per cent down to 30 per cent for 90 days. US President Donald Trump said this month that 80 per cent tariffs on Chinese goods “seems right”. Trade talks are continuing between the two countries. VTech, which also makes baby monitors, smartphones and headsets, said prices of imported goods for American consumers will rise. “Unfortunately [the] tariffs [translate] to higher prices for some of the products going to the US,” Wong said. “[That] will inevitably affect some of the purchasing power of the consumer.” The warnings echo those made this month by Mattel, the toy maker behind Barbie dolls. The US-based company warned prices would rise and said it was accelerating efforts to shift production out of China.By 2027, China will account for less than 10 per cent of Mattel’s US imports, chief executive Ynon Kreiz said last week. This year the company will move 500 product lines out of China, up from 280 last year as it diversifies its supply chain.VTech has been negotiating with US retailers on price increases but decisions have not been made yet. “It [the price increase] will be lower than 30 per cent . . . [But by] how much, we don’t know, it depends on ultimately what the tariffs look like,” Wong added. VTech’s chief executive said that selling into the US was not possible at a 145 per cent tariff, but 30 per cent tariffs meant the situation was “manageable”. Some Chinese exporters are considering leaving the US market if tariffs remain at high levels. Wong said, however, that VTech has no plans to exit the US market.“The US currently is still a major market for us . . . we will not give up the US market,” he said.VTech reported annual revenues of $2.2bn, a 1.5 per cent increase on last year. Profits attributable to shareholders fell 5.9 per cent to $156.8mn due to a rise in operating expenses. The company forecast a decline in revenue for the coming year, as US consumers rein in spending.Additional reporting by Gregory Meyer in New York and Gloria Li in Hong Kong More

The furious rally in US assets sparked by the tariff détente between Washington and Beijing has caught big investors off guard, colliding with widespread bets against the dollar and Wall Street stocks. The S&P 500 has rallied 3.3 per cent this week, erasing all of its losses this year, after the US and China agreed to cut tariffs for at least 90 days, signalling an end to the worst of the trade war. The dollar rose too, while US government bond prices have dropped as traders exit traditional havens. The rush of money back into stocks has stung large asset managers and other institutional investors, who were cautiously positioned on US assets on fears of a dramatic economic slowdown and broader worries over US policymaking. “I think the market got caught quite offside,” said Robert Tipp, head of global bonds at PGIM Fixed Income. “As the climbdowns and deals started to look more plausible — even though there are still a lot of tariffs by modern standards — that has forced a reassessment and a major position squaring.” Broader negative bets, including those by trend-following hedge funds, may have exacerbated the moves higher as traders were squeezed out of their positions, analysts said. A fund manager survey from Bank of America, which was largely completed before the US-China announcement, found respondents had their dimmest view of US stocks in two years.The BofA survey respondents also had the most negative collective view of the dollar since 2006. That was backed up by Commodity Futures Trading Commission data, which showed that asset managers last week had the biggest bullish bets on the euro since September 2024. Charlie McElligott, a strategist at Nomura, added, “essentially, every thematic macro trade of the past few months is going [the] wrong way.” In a sign of the dramatic shifts in sentiment, the Nasdaq Composite has surged nearly 30 per cent from a low just weeks ago, after Trump’s April 2 “liberation day” tariff announcement shook markets. The CFTC data, which covers the seven-day period ended May 6, also showed that asset managers had their largest ever long position in 10-year Treasury futures, a bet that prices would rise and yields would fall. The 10-year yield is particularly sensitive to growth expectations, so the trade suggested that investors were betting on higher chances of a recession later this year. It has jumped to 4.45 per cent from a closing low in early April of about 4 per cent.“There are some institutional investors who had de-risked pretty significantly. And there was loads of cash on the sidelines,” said Gargi Chaudhuri, chief investment and portfolio strategist for the Americas at BlackRock. The dramatic recovery in stocks has been accompanied by a fall in market expectations of volatility. The Vix, Wall Street’s “fear gauge”, is back at pre-liberation day levels. Expectations of swings in the euro-dollar exchange rate have fallen to their lowest since March, according to an index provided by derivatives giant CME Group. Deutsche Bank data suggests that retail investors may have benefited from buying the dip, snapping up stocks throughout most of April while professional investors held off. The S&P’s rally over the past month has been driven by buying during regular New York cash trading hours, when amateur investors are most active, the bank said. In contrast, returns during overnight trading, when institutional investors continue to purchase stock futures and derivatives, “have been muted”.Some asset managers warn that this shift towards trade optimism has run too far. “We should remember the policy chaos damage to consumer and business confidence before getting too optimistic,” said Andrew Pease, chief investment strategist at Russell Investments.In particular, investors said the dollar, which gave up Monday’s gains on Tuesday and Wednesday, could weaken as the economic impact of the trade disruption becomes clear. “My guess is that this is a temporary relief for the dollar, and the tariff rates will be high enough to have a stagflationary impact on the US economy, said Athanasios Vamvakidis, head of global G10 FX strategy at Bank of America. “For the dollar to weaken again, we need the US data to weaken — we believe it will.”Dominic Schnider, head of global FX & commodities at UBS’s wealth management arm, said investors “have yet to see how much the damage [from the trade war] is going to be”. More

This article is an on-site version of our FirstFT newsletter. Subscribers can sign up to our Asia, Europe/Africa or Americas edition to get the newsletter delivered every weekday morning. Explore all of our newsletters hereGood morning and welcome back to FirstFT. Here are today’s highlights:Trump meets Syria’s new president in RiyadhUS warns companies not to use Huawei AI chips FT investigates Elon Musk’s DogeWhich airlines serve the best in-flight champagne? Donald Trump has met Syria’s new president Ahmed al-Sharaa in Riyadh one day after he announced that the US would lift sanctions on the country and consider restoring relations. Here’s what you need to know.Where did the two leaders meet? The US and Syrian leaders met in the the Saudi Arabian capital of Riyadh. The meeting between Donald Trump and Ahmed al-Sharaa was brokered by Saudi’s de facto leader Crown Prince Mohammed bin Salman and Turkish President Recep Tayyip Erdoğan in order to give Syrians a “fresh start”. The meeting follows a day of dealmaking in the Saudi capital when $600bn worth of defence, artificial intelligence and other agreements were signed by the US with the kingdom.Why is Washington softening its stance towards Syria? The meeting follows the decision by the US to lift sanctions on Syria. “We are currently exploring normalising relations with Syria’s new government,” Trump said after the meeting. The decision by Washington to drop sanctions, which was met with celebrations in Damascus, will boost Sharaa as he battles to consolidate his administration’s control over the fragmented nation. The Saudi crown prince said he welcomed Trump’s decision to lift sanctions, adding that it “will help alleviate the suffering of the Syrian people and open a new page towards growth and prosperity”. Here’s what else we’re keeping tabs on today:Nato: The military alliance’s foreign ministers meet in Turkey to discuss Ukraine, ahead of expected Ukraine-Russia peace talks tomorrow.Germany: Chancellor Friedrich Merz delivers his first major policy speech to the lower house of parliament since taking office.Economic data: Brazil’s services sector is likely be scrutinised today, with the release of monthly PMS data. Separately, Argentina’s National Institute of Statistics and Censuses will be releasing the consumer prices data for April. US economy: Federal Reserve governor Christopher Waller, vice-chair Philip Jefferson and San Francisco Fed chair Mary Daly appear at events.Companies: Cisco Systems is expected to post a 10.6% increase in third-quarter revenue.Congress: Robert F. Kennedy Jr will testify before Congress for the first time since taking the role of health secretary, and will face questions over the firing of thousands of health agency employees and a fast-growing measles outbreak.Join us for a subscriber-only webinar on May 28 for insights into the most consequential geopolitical rivalry of our time: the US-China showdown. Register now and put your questions to our panel.Five more top stories1. Exclusive: Tesla’s board has formed a special committee to explore Elon Musk’s pay, which could lead to the electric-vehicle maker’s chief being offered a fresh package of stock options. People familiar with the matter said major investors had given the board their views on the billionaire’s pay and continued leadership of the company.2. President Donald Trump’s administration has taken a tougher stance on Chinese technology advances, warning companies around the world that using artificial intelligence chips made by Huawei could trigger criminal penalties for violating US export controls. The commerce department issued guidance to clarify that Huawei’s Ascend processors were subject to export controls. 3. The US is exploring a potential deployment of Latin American peacekeeping troops to Haiti, according to three people familiar with the situation. A Kenyan-led international force has failed to halt a takeover by criminal gangs of Haiti’s capital Port-au-Prince which threaten to seize the last few neighbourhoods to which the country’s interim government has retreated. Read more on how the deployment would work.4. Moët Hennessy went from generating €1bn in cash in 2019 to burning through €1.5bn last year, according to documents seen by the FT. People familiar with the group behind Dom Pérignon champagne and Hennessy cognac said strategic decisions made under the leadership of former chief executive Philippe Schaus, who left the group at the start of 2025, exacerbated its problems.5. China has criticised a trade deal between the UK and US that could be used to squeeze Chinese products out of British supply chains, complicating London’s efforts to rebuild relations with Beijing. Asked about the deal, Beijing said it was a “basic principle” that agreements between countries should not target other nations.UK-US: Washington is eyeing a multibillion-dollar slice of Britain’s pork, poultry, rice and seafood sectors, as it looks to expand the trade deal.China manufacturing: Exporters were “shocked and elated” after China and the US agreed a thaw in their trade war.US-China: Ports and shipping lines are braced for a demand “whipsaw” as businesses race to stockpile Christmas goods during the 90-day trade war “ceasefire”.News in-depthSix months after Donald Trump officially announced the formation of Elon Musk’s cost-cutting vehicle, the so-called Department of Government Efficiency (Doge), it yet to find a fraction of the $2tn of savings promised at a rally in New York’s Madison Square Garden during the election campaign. Today’s Big Read has found evidence of inflated valuations to boost numbers and contracts that were due to lapse being claimed as new savings. Read the investigation in full.We’re also reading and watching . . . Global trade: We seem unable to turn the surplus in some countries into productive investment elsewhere, writes Martin Wolf.Trump’s “palace-in-the-sky”: Qatar’s offer of free jumbo jet advances the argument that the US is becoming a kleptocracy under this president, argues Edward Luce.Milk is back: The dairy industry’s efforts to woo customers away from plant products are a masterclass in corporate survival tactics, writes Brooke Masters.🎬 $40bn bitcoin bet: Michael Saylor transformed lossmaking Strategy into the world’s largest corporate holder of the cryptocurrency. Can it survive a crash?Chart of the dayUS stocks recovered their losses for the year after yesterday’s lower than expected inflation figures added fuel to a rally sparked by Trump’s deal with China to cut tariffs. “There’s been an instant reversal in the prevailing trends of the last several months,” said one fund manager.Take a break from the newsHTSI drinks columnist Alice Lascelles shares which airlines serve the best champagne — “for those lucky enough to turn left when boarding”.© Getty Images More

This article is an on-site version of our Unhedged newsletter. Premium subscribers can sign up here to get the newsletter delivered every weekday. Standard subscribers can upgrade to Premium here, or explore all FT newslettersGood morning. President Donald Trump’s Middle East tour has already been full of surprises. On Monday, he accepted Qatar’s gift of a plane, despite ethics concerns. And yesterday, he announced a big defence and AI pact with Saudi Arabia, and a surprise end to US sanctions on Syria. Three days to go. How many more surprises are in store?Unhedged is thrilled to introduce a new team member, Hakyung Kim. Hakyung, a graduate of NYU Stern, is joining us from CNBC, where she covered markets, after stints at The Wall Street Journal and NPR. She already appears likely to join the list of people Rob has hired who turn out to be smarter than he is. Email us: [email protected], [email protected] and [email protected] inflationThe news was most welcome: headline CPI inflation rose just 2.3 per cent in April from a year before, the lowest since early 2021. But as regular readers will know, that’s not how Unhedged likes to look at it. We like to exclude food and energy and look at the month-to-month change annualised. This is a smoother and more timely reading. And on this basis, inflation picked up a bit this month:The trend of recent months remains in place: a herky-jerky sideways movement at a level just enough above the Fed’s 2 per cent target to be annoying. A move up in housing prices (a notoriously lumpy series) was a key culprit in keeping prices up this month, but it is not the only factor making the “last mile” of core deflation hard to achieve. Non-housing services inflation, a particular concern for the Fed, is only coming down grudgingly.No one cares about this right now, though. What they care about is whether Trump’s “reciprocal” tariffs, announced early in April then reduced by fits and starts, have shown up in higher prices. And the answer is: maybe, a little. Several import-heavy categories had a hottish month. Here, for example, are month-over-month changes in furniture prices:The 1.5 per cent increase between March and April does look a little high. But, again, the data is volatile. It’s hard to say firmly if tariffs were to blame. That’s not to say that there is nothing to see here. Rather, the nothing is the thing to see. If there was a tariff effect, it wasn’t dramatic, and that’s good news. It shows that retailers did not go in for large price increases in anticipation of incoming tariffs. Next month may be different. But we’ll take reassurance where we can find it.What to expect from a US default near missTreasury secretary Scott Bessent has encouraged Congress to reach a deal to raise or suspend the US’s debt limit by mid-July. If that doesn’t happen, the Treasury will need to take extraordinary measures to avoid missing a debt payment by as soon as August. We expect that Congress will reach some solution before the “X-date”; the consequences of failure are simply too great. But as the days tick by, a “near miss” — Congress raising the debt ceiling just days or hours before the Treasury runs out of money — becomes more likely, and a terrible mistake becomes conceivable. How might the market start to act if negotiations drag on as the X-date approaches? Looking at recent notable near misses — 2011, 2013 and 2023 — provides clues.Credit default swaps: Credit default swaps on Treasuries, a direct hedge against the possibility of a US sovereign default, are the most responsive to the US’s budget situation. The cost of a 1-year credit default swap on a Treasury rose substantially in 2011, 2013 and 2023:The CDS price is now around the levels of 2011 and 2013. Yet, the price went way higher in 2023. It’s not clear why, but there are at least three candidate explanations. It could be that the market has become more aware of the risks after experiencing multiple near misses in the 2010s and as conversations about the US deficit have become more urgent. Or it could be because in 2023 the Fed was shrinking its balance sheet (quantitative tightening) rather than expanding it (quantitative easing). Or it could simply be because the US debt was much higher, both in absolute terms and as a percentage of GDP, in 2023 than in 2011 and 2013:All those dynamics are currently at play, to varying degrees. CDS prices could rise quite a bit further from here.Equities: In 2013 and 2023, the market went down slightly before a deal was reached and got a small bump afterward. It is unclear if the looming X-date was the cause, but according to Goldman Sachs and the Bipartisan Policy Center, companies with high exposure to government spending, such as infrastructure and defence groups, noticeably underperformed the market in the run-up. Chart courtesy of the Bipartisan Policy Center:2011 saw a much bigger equity response. In the weeks before and after the X-date — which Congress beat by only two days — the market dropped 17 per cent, the largest correction since the financial crisis just three years earlier:Why things were different in 2011 and why the market continued to fall after the agreement was reached is, again, not perfectly clear. It was the first near miss after the great financial crisis and a US default seemed like more of a real possibility. The US economy was wobbly and the Eurozone was under strain, too. And right after the incident, Standard and Poor’s downgraded the US’s credit rating from AAA to AA+, even though the budget was already signed. That the US came through the mess in one piece may have made equity investors less sensitive when Congress next crept up to the edge. Treasuries: Treasuries show a more durable trend: yields on the absolute shortest duration Treasuries jump, while moves in longer-term Treasuries are muted. From Shai Akabas at the Bipartisan Policy Center: What we have seen clearly in past episodes is that there is an increase in the rate or reduction in the price of securities that are maturing shortly after the projected X date, because investors are concerned about holding securities [that could go unpaid soon] . . . We have not seen a significant movement in longer term rates that can be easily attributed to the debt limit.2023 is a good illustration. One-month yields (the dark blue line below) leapt, the 3-month and 2-year yields crept up, while longer tenors were mostly indifferent:Akabas notes that longer-dated Treasuries might not react in part because default still seems quite unlikely. But that would probably change quickly were the US government to miss a payment.Together, past near misses suggest we might see a big jump in CDS prices and T-bill yields, and downward pressure on the S&P 500 this summer, especially if Trump’s “big beautiful” tax bill hits roadblocks. But note that 2025 is very different from 2011, 2013 and 2023. In all three earlier instances, Republicans had control of at least one chamber of Congress and were battling with a Democratic presidential administration over spending cuts or freezes. Things are harder to read this time. Republicans have control over the House, Senate and the presidency, but there are spending disagreements within the caucus, surprising policy proposals emanating from the president and a Democratic party that is missing in action. The probability of a near miss, or worse, is harder to read.Investors are facing a messier debt and economic picture, too. Debt and debt interest payments are higher than in the past three episodes. The economy is trickier to analyse because of tariff uncertainty. And foreign demand for Treasuries is questionable at the margin.  That markets, particularly equity markets, were generally calm around past near misses suggests broad trust in the US as a creditor and Congress as a responsible actor. But that could be changing. “Institutional concerns about the US government are higher than at any point in the modern era . . . Congress may not be able to control the market’s fear” said Alexander Arnon, director of policy analysis at the Penn Wharton Budget Model. We hope it isn’t so. (Reiter)One good readEveryone’s a winner.FT Unhedged podcastCan’t get enough of Unhedged? Listen to our new podcast, for a 15-minute dive into the latest markets news and financial headlines, twice a week. Catch up on past editions of the newsletter here.Recommended newsletters for youDue Diligence — Top stories from the world of corporate finance. Sign up hereFree Lunch — Your guide to the global economic policy debate. Sign up here More

Unlock the Editor’s Digest for freeRoula Khalaf, Editor of the FT, selects her favourite stories in this weekly newsletter.Jacob Rothman, who has been making kitchenware in China sold by US retailers including Walmart for more than two decades, was “shocked and elated” when Washington and Beijing reached a truce in their tariff war.But the co-founder of Velong Enterprises said the deal, under which the US agreed to slash additional tariffs on Chinese goods from 145 per cent to 30 per cent for 90 days, offered little more than a temporary reprieve. “It’s exactly the percentage that keeps my categories of product viable,” said Rothman of the level of US tariffs on Chinese imports, which is now about 40 per cent. “We’ve gained a bit more breathing room . . . beyond that, it’s uncertain.”China-based exporters greeted the announcement on Monday of the tariff rollback with relief. Shipments to the US are expected to “significantly increase” in the coming few weeks, according to Wang Xin, head of the Shenzhen Cross-Border E-Commerce Association, which represents more than 2,000 Chinese merchants. The truce, negotiated by US Treasury secretary Scott Bessent and Chinese vice-premier He Lifeng in Geneva over two days of talks last weekend, averted a hard decoupling between the world’s two biggest economies.Chinese vice-premier He Lifeng, center left, and US treasury secretary Scott Bessent, centre right, met in Geneva More

Unlock the Editor’s Digest for freeRoula Khalaf, Editor of the FT, selects her favourite stories in this weekly newsletter.President Donald Trump’s administration has taken a tougher stance on Chinese technology advances, warning companies around the world that using artificial intelligence chips made by Huawei could trigger criminal penalties for violating US export controls.The commerce department issued guidance to clarify that Huawei’s Ascend processors were subject to export controls because they almost certainly contained, or were made with, US technology.Its Bureau of Industry and Security, which oversees export controls, said on Tuesday it was taking a more stringent approach to foreign AI chips, including “issuing guidance that using Huawei Ascend chips anywhere in the world violates US export controls”.  But people familiar with the matter stressed that the bureau had not issued a new rule, but was making it clear to companies that Huawei chips are likely to have violated a measure that requires hard-to-get licences to export US technology to the Chinese company.“The guidance is not a new control, but rather a public confirmation of an interpretation that even the mere use anywhere by anyone of a Huawei-designed advanced computing [integrated circuit] would violate export control rules,” said Kevin Wolf, a veteran export control lawyer at Akin Gump. The bureau said three Huawei Ascend chips — the 910B, 910C and 910D — were subject to the regulations, noting that such chips are likely to have been “designed with certain US software or technology or produced with semiconductor manufacturing equipment that is the direct produce of certain US-origin software or technology, or both”.The guidance comes as the US has becoming increasingly concerned at the speed at which Huawei has developed advanced chips and other AI hardware. Huawei has begun delivering AI chip “clusters” to clients in China that it claims outperform the leading US AI chipmaker Nvidia’s comparable product, on key metrics such as total compute and memory. The system relies on a large number of 910C chips, which individually fall short of Nvidia’s most advanced offering, but collectively deliver superior performance to a rival Nvidia cluster product.The Shenzhen-based conglomerate currently offers its Ascend series processors, mainly the 910B and 910C, to Chinese companies. Huawei is boosting production capacity by building its own advanced semiconductor production lines, as Chinese companies cut off from Nvidia’s products are increasing orders. There is growing US concern that China’s national champion will soon be selling AI processors in both China and foreign markets that can compete with Nvidia and other US companies’ products. Nvidia chief Jensen Huang said last month Huawei was “one of the most formidable technology companies in the world” and US policies should help his company compete on the global stage.Nvidia declined to comment on the bureau’s new rules. Huawei did not immediately respond to a request for comment.The commerce department also rescinded the AI Diffusion Rule on Tuesday, a measure the previous Biden administration had planned would take effect on May 15. It was designed to limit exports of AI chips to other countries and make it harder for China to circumvent existing US export controls. But the department said the rule was too bureaucratic — a view former Biden officials reject — and it would issue a replacement in the future.The announcement came on the day Trump visited Saudi Arabia, where he unveiled a raft of deals, including a commitment by the kingdom’s new state-owned AI company, Humain, to build AI infrastructure using hundreds of thousands of Nvidia chips.A source familiar with the situation said the scale of the proposed Gulf deals shocked many senior Trump administration officials. They were concerned about offshoring large-scale AI infrastructure, and also turning a blind eye towards Saudi and the United Arab Emirates’ collaborations with Beijing.Additional reporting by Michael Acton in San Francisco More

Unlock the Editor’s Digest for freeRoula Khalaf, Editor of the FT, selects her favourite stories in this weekly newsletter.Ports and shipping lines are braced for a “whipsaw” in demand as businesses race to stockpile Black Friday and Christmas goods during the 90-day ceasefire in the US-China trade war.Analysts warned that the sharp drop-off in container ship bookings from China to the US following President Donald Trump’s April “liberation day” tariff announcements would now be followed by an equally rapid surge in imports that will test port handling capacity.“First we’ll see a massive drop in cargo arriving in US ports; then a massive surge as goods now waiting on the quayside in China are shipped to the US. It’s a carbon copy of the whipsaw effects we saw in the pandemic,” said Lars Jensen, chief executive of Vespucci Maritime consultancy.Logistics hub Freightos said it expected “a period of tight capacity and some equipment shortages” as shipping lines and ports try to manage what is expected to be a sudden increase in volumes following the announcement of the 90-day truce by Washington and Beijing on Monday.The ceasefire deal will slash the headline US tariff on Chinese imports from 145 per cent to 30 per cent for at least 90 days, pending further negotiations between the two sides.Normally US retailers would import goods for the key Black Friday sales period and Christmas between July and mid-October, but they are now expected to pull orders forward to beat the potential expiry of the trade truce on August 10.As a result, businesses could face increased container rates and some delays in the next few weeks “at both origins and US destinations”, wrote Judah Levine, head of research at Freightos, in a note to clients on Monday.The effects of the tariff cut announced on Monday will take time to show up in data, analysts said, with ships taking about 4-6 weeks to reach the US, meaning import freight volumes will continue to fall for the next few weeks. A wave of cancelled freight bookings in April resulted in almost 400,000 fewer containers booked on Asia-to-North America routes during the four weeks from May 5 than planned, according to shipping data analysts Sea-Intelligence.Show video infoBefore Monday’s deal, the US National Retail Federation had forecast a 20 per cent year-on-year fall in container shipments to the US from China between June and September.Although shipping rates are expected to increase, Freightos forecasts that they will probably still remain below last year’s high season rates of $8,000 per 40ft equivalent container to the US West Coast, and more than $9,800/FEU to the East Coast. Before the trade wars broke out, large shipowners had ordered record numbers of new container vessels.“With rates already more than 30 per cent lower than a year ago due to fleet growth and increased competition between the new carrier alliances, peak season rates may not climb as high as last year’s peak season highs,” Freightos’s Levine added.However, the full impact of the 90-day truce remained difficult to predict given that US tariff rates on Chinese imports would still be higher than before Trump’s announcements in April, said Sea Intelligence chief executive Alan Murphy.“Under normal circumstances, an expectation of tariffs would see importers frontloading cargo. In this case though, with the pause still seeing 30 per cent tariffs on Chinese imports, higher than any previous tariffs on China, the incentives are less clear,” Murphy added.High levels of US stockpiling after Trump was elected in November last year may also ease pressures, some analysts added. US import volumes were 11 per cent higher between November 2024 and April 2025 compared with a year previously, according to National Retail Federation data.Revolution Beauty plc, a UK-listed mass beauty brand, said in a trading update on Tuesday that it had benefited from stockpiling “significant volumes” of products of Chinese origin in the US before tariffs hit in April, and it was now starting to reauthorise shipments where needed.  More

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