What to expect as the Liberation Day deadline looms

Given the limited progress in concluding trade negotiations since Liberation Day, there is a risk that huge tariffs will be imposed on 9^th July after the 90-day pause expires. We suspect that further last-minute concessions will be made to permit extensions for most countries, but a few of the “worst offenders” may be singled out for punitive treatment. Markets seem to be positioned for a fairly benign outcome, implying a risk of some near-term turbulence if that fails to materialise.