How significant is the impact of tariffs on the global economy? Data in the coming week will provide a comprehensive overview

The 90-day "truce period" of the Trump trade war is more than halfway through, and a series of economic data set to be released next week will comprehensively reveal the true impact of tariffs.

On Monday, China's economic data for April, including retail sales and industrial production, will be released first, followed by the S&P Global PMI index for major economies on Thursday. These data will collectively outline the substantial impact of U.S. tariff policies on global growth.

On Tuesday, G7 finance ministers will meet in Canada, which may lead to a collective assessment of trade shocks, provided they can reach an agreement on a communiqué.

Additionally, the European Commission will release economic forecasts on Monday, while the European Central Bank will provide an assessment of financial stability impacts two days later.

According to S&P Global data, the global PMI fell to a 17-month low in April, and next week's events and reports will focus on showcasing the ripple effects triggered by Trump’s tariffs.

Focus on whether PMI will indicate a slowdown in growth and rising inflation

Although the Chinese data reflects the situation in April, the S&P Global PMI figures are for May and will provide a preliminary assessment of economic activity, including Australia, Japan, the Eurozone, the UK, and the U.S.

In China, a series of economic data will be released on Monday, with expectations for stronger retail sales in April, a possible slowdown in industrial production, and an unchanged unemployment rate. In the U.S., weekly unemployment claims data will be released on Thursday, along with S&P Global's preliminary surveys of manufacturing and service providers for May. According to economists' forecasts, industrial weakness may continue, while service sector activity growth may see a slight uptick.

S&P Global economists Chris Williamson and Jingyi Pan stated in the report:

The international trade environment remains highly uncertain, with markets widely expecting these tariffs to suppress global growth and push up inflation.

Bloomberg economists noted:

April import prices indicate that the U.S. continues to bear most of the tariff costs. While we know little about changes in trade patterns in April, the import price index excluding tariff costs has changed little since the beginning of the year. This suggests that the basic prices paid by U.S. importers are the same as they would be without tariffs, plus the tariffs.

However, as the U.S. negotiates tariff levels, global business relations remain in turmoil, with evidence suggesting that merely the anticipation of Trump’s trade offensive has already distorted businesses. Data released on Friday showed that EU exports to the U.S. increased by nearly 60% year-on-year in March, as companies rushed to front-load shipments before the tariff announcements.

In addition to trade-related data, this week’s global economic focus also includes U.S. housing data, inflation data from Japan to the UK to Canada, potential interest rate cuts in Australia, and the minutes from the European Central Bank's April decision-making meeting