Stock markets, bonds and currencies moved sharply after Mr Trump put a 90-day pause on tariffs other than the base 10% tax slapped on almost all imports to the US. China still faces a levy of 125% on the goods it exports to the US. But there have still been some impactful changes since his so-called "liberation day" tariff announcement last week. So, what's happened?
Well, last week two more interest rate cuts were expected by the end of this year, but now traders are pricing in three cuts by the Bank of England. Borrowing will become cheaper as the interest rate is now anticipated to be brought down more than previously thought, to 3.75% by the end of 2025 from the current 4.5%.
Tariffs latest: Beijing takes fight to Trump Money blog: 'Barclays just sent me £50' It's not exactly for a good reason, though. The trade war means the UK economy is forecast to grow less.
This lower growth is what's making observers think the Bank will cut rates sooner - making borrowing cheaper can lead to more spending. Increased spending can stimulate economic growth. What does this all mean for you? Some debts, like credit card bills, will become a bit cheaper. Mortgages Crucially for anyone soon to re-fix their rate, this means mortgage costs are falling. Already, the typical two and five-year fixed rate deals are coming down, according to data from financial information company Moneyfacts.
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After weeks where the average rate would fall only once or twice, there have been larger and daily falls, the data shows. As of Thursday, the typical rate for a five-year deal is 5.14%, and 5.29% for the average two-year fixed mortgage. If the interest rate expectations remain, by the end of the year, the average two-year fixed mortgage rate will fall to 4.3% if a person is borrowing 75% of the property's value, according to analysts at Pantheon Macroeconomics. Filling up your car Another positive that's motivated by a negative is the reduced fuel cost to the motorist of filling up their vehicle. The oil price fell due to rising fears of a recession in the world's biggest economy. Now that those concerns have somewhat subsided, the oil price has remained comparatively low at $63.75 for a barrel of the benchmark Brent crude.
It's far below the average price of $80 from last year. This lower cost is likely to filter down to cheaper prices at the pump within days as the sharp oil price drops hit at the end of last week. Lower oil costs could help bring down costs overall, lowering inflation, as oil is still used in many parts of the supply chain.
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👉 Listen to Sky News Daily on your podcast app 👈 Savings Lower interest rates mean falling savings rates, so savers can expect to get less of a return in the coming months. Anyone with a stocks and shares ISA (Individual Savings Account) is likely to get a shock when they see the decline in their returns.
Holidays It's not the best time to be heading off on a trip to a country that uses the euro. The pound hasn't strayed far from buying €1.16, a low last seen in August. It means your pound doesn't go as far, as you're getting less euro. Against the dollar, however, sterling has risen to $1.29. The exchange rate had been higher in the immediate wake of Mr Trump's tariff announcement as the dollar value sank. At that point, you could briefly have bought $1.32 for a pound.
Supermarket shopping
Helpfully, the UK's biggest and most popular UK supermarket, Tesco, updated us that it expects tariffs will have a "relatively small impact".
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