Container and cargo volumes grow sharply after bilateral deal, but Trump’s new tax bill and falling consumer confidence fuel instability
Trade between the US and China rebounds—but beware the bottlenecks
After the bilateral agreement signed in May, US-China trade is back in full swing. Container bookings to the US more than doubled, and shipping rates on the Shanghai–Los Angeles route rose by 16%, reaching $3,136 per 40-foot container—the biggest weekly increase of 2025. Air cargo traffic from China also surged by 18%.
However, according to the Drewry observatory, this spike could be short-lived. Many companies are likely front-loading shipments to avoid regulatory uncertainty. The downside? New logistics bottlenecks and rising export costsfor Europe, Italy included.
Trump’s tax bill: fewer social protections, more tax breaks for the rich
With a narrow vote, the US House approved the controversial “One Big Beautiful Bill Act”, backed by Donald Trump. The bill:
- extends 2017 tax cuts,
- slashes social spending, including Medicaid and SNAP,
- dismantles key measures from Biden’s Inflation Reduction Act.
According to the Congressional Budget Office, this would add $3.4 trillion to US debt by 2034, possibly ballooning to $23.7 trillion by 2055. The debt-to-GDP ratio could surpass 200%.
Income inequality and sovereign rating downgraded
Low-income households are projected to lose up to 4% of disposable income by 2033, while the wealthiest 10% will gain a similar amount. This regressive redistribution is alarming economists—especially after Moody’s downgradedthe US rating from “Aaa” to “Aa1”. A clear market signal of fiscal unsustainability.
Consumer confidence plunges, inflation fears return
The University of Michigan’s consumer sentiment index fell to 50.8, the lowest since June 2022. One-year inflation expectations surged to 7.3%, the highest since 1981. Three out of four Americans blame tariffs for the uncertainty—highlighting how trade policies are hurting consumer psyche and domestic demand.
PMI climbs, but inflationary pressures intensify
The May PMI index rose to 52.1, signaling moderate economic expansion. Yet both services and manufacturing components point to strong price pressures, suggesting inflation remains structural.
Fed stays cautious: no rate cuts until fall
Within the Federal Reserve, momentum is growing to delay rate cuts until at least September. Voting members like Williams and Musalem warn about inflationary risks linked to trade policy. Bostic and Hammack even mention stagflation, while Kashkari says investment is already slowing due to trade uncertainty.
Europe and Italy on alert
“The reopening of trade with China is a positive sign,” said Giuseppe Spadafora, vice president of Unimpresa. “But new supply chain bottlenecks and the consequences of US fiscal policy choices must not be underestimated. A debt approaching 200% of US GDP, in a context of declining confidence and rising inflation expectations, is a signal Europe—and Italy—cannot afford to ignore.”
Frequently Asked Questions (FAQ)
1. What does the new US-China trade deal include?
It facilitates more trade and lowers tariff barriers.
2. Why have shipping rates increased?
Due to a surge in container bookings following the agreement.
3. Are we facing another logistics crisis?
There’s a risk of new bottlenecks similar to those seen during the pandemic.
4. What does the “One Big Beautiful Bill Act” do?
Extends tax cuts for the wealthy and slashes welfare spending.
5. Why did Moody’s downgrade the US credit rating?
Because of the rising and potentially unsustainable US debt.
6. What’s happening with US consumer confidence?
It’s collapsing, reaching its lowest level in nearly 3 years.
7. Is the economy recovering?
PMI suggests modest recovery, but inflation remains a major threat.
8. Will the Fed cut interest rates soon?
Not before September, according to key Fed officials.
9. How does this affect Italy and Europe?
Higher export costs and global instability could hit European manufacturers.
10. What does Unimpresa recommend?
Closely monitor global developments to avoid systemic shocks.
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