Despite warnings that the impact of US tariffs would hit the US economy hardest, the US Federal Reserve sat on its hands last week, using the cover of uncertainty on the outlook to continue its pause on interest rates. However, some clarity is now starting to emerge, with the US agreeing a significant de-escalation in tariffs with China over the weekend, following a framework deal with the UK last. The takeaway from these recent developments is that both the US and China are now looking to undo the damage of the tit-for-tat trade war, which was already beginning to be felt in both economies in recent weeks.