The narrative of American exceptionalism has been prevailing in recent years, given the srong economic fundamentals including robust labor market as well as consumption.
Trade tentions between U.S. and China and the EU and China have been mounting this year, with both the U.S. and EU implementing higher tariffs on some Chinese goods over what they claim are unfair trade practices from Beijing. China also announced temporary tariffs on some imports from the EU as tit-for-tat measures continue.
The narrative of ''American Exceptionalism" has been the core logic in global macro markets over the last several years, which bases on the outperformance of U.S. economy relative to the EU as well as the advantages in tech and policy flexibility.
The inflation is drifting down to the Fed's 2% target, with consumer and producer price indexes both come in around expectations.
The wealth effect had been keeping along with the long term upward trend of US equity market before the turbulence in Feb. Right now it seems that the trend is reversing based on the sharp decline of market since Feb18 given multiple uncertaines lingering, which is disrupting the confidence of investors substantially.
