Insights 
VT 
The Trump Administration has requested countries to present their best offers in ongoing tariff negotiations by Wednesday. Despite earlier weeks filled with deals, such as the China/US tariff reduction, no additional agreements have been secured in the past two weeks.
Japan and India remain distant in reaching deals, contributing to the frustration. High steel tariffs of 50% could pose challenges for Canada and Mexico, potentially impacting negotiations with these countries.
Pressure Mounts In Negotiations
Asking countries to submit top-line offers swiftly points to mounting pressure behind closed doors. Though some initial arrangements gave way to optimism—particularly the reduction in levies between two of the world’s largest economies—progress has flatlined across several fronts. That momentum, which once seemed to stretch toward broader consensus, now appears to have slowed, with deadlines tightening and concessions harder to come by.
The distance in positions held by Japan and India hasn’t narrowed. Their reluctance, whether due to domestic constraints or strategic hesitations, continues to stall forward motion. This, in effect, increases the strain on parallel talks with other partners. For example, tariffs on steel—currently positioned at a punitive 50%—remain a stumbling block for Canada and Mexico, especially if exemptions or waivers continue to be withheld. These aren’t token measures. They directly alter terms of trade and change hedging assumptions in markets that were once relatively stable.
We should not assume a breakthrough is imminent. When combing through week-ahead positions, it’s essential to look not only at implied volatility in related sectors but also to weigh the probability that no offer will be accepted before the deadline. Traders need to stay alert to potential reaction patterns across equity-linked instruments and commodity exposure, particularly in metals.
Deadlines as Leverage
What we’ve seen from Lighthizer is a deployment of deadlines as leverage rather than endpoints. It is likely the call for “best offers” will be used to separate those willing to deal from those opting to wait out pressure. In this environment, waiting brings its own cost. Pay special attention to moves in industrials and shipping—markets that tend to move in anticipation rather than on confirmation of trade shifts.
For us, that means counter-positioning might be more effective than chasing headline optimism. In relation to steel-heavy inputs, any short-term hedging should now assume prices remain elevated into the next settlement window unless a tariff schedule adjustment is pre-announced. Also, spread widening in options linked to Indian and Japanese exposure deserves scrutiny given recent lack of convergence between demand and forward pricing in those regions.
In the short term, it’s best not to expect announcements to lead outcomes. Activity should pivot on what gaps remain, not on what statements are made. The pattern now tells us to monitor actions more than rhetoric. This matters more than ever in a week that might otherwise appear calm. Keep toggling between futures levels and open interest shifts. They’re likely to speak louder than any public declaration this week.
