Donald Trump has already caved in on tariffs, pausing the ‘retaliatory levies’ he announced on ‘Liberation Day’ at the beginning of April. Now the President is under pressure from the markets on spending. As his ‘Big, Beautiful Bill’ on the budget goes through Congress, investors are panicking over the mix of spending and tax cuts, with bond yields spiking sharply upwards and equities falling. President Trump will now have to decide whether to yield to Wall Street again – or tough out a potential crash.
The US remains the biggest economy in the world, so investors cannot abandon it completely
The post-tariff recovery on Wall Street came to a juddering halt yesterday. A weak auction of Treasury bills, as American debt is known, sent yields sharply higher, and the S&P 500 fell 1.6 per cent as investors grew nervous over the rising cost of debt.
The reason? The budget bill is close to passing through Congress.
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