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Good morning! After a turbulent day marked by unpredictable market fluctuations stemming from an unusual eventa man waving a large poster in his gardenChancellor Rachel Reeves is set to travel to Warsaw today. She will be attending a finance ministers meeting within the European Union, a gathering that promises to provide a stark contrast to the chaos back home in the UK.

Reflecting on the past, I remember when former Labour Chancellor Gordon Brown utilized Ecofin meetings as a strategic platform for domestic political gains. Headlines would often read, Brown to tell Europe to do X, serving as a preemptive narrative aimed at the Eurosceptic press. In contrast, Reeves is preparing to approach this EU meeting with a cooperative spirit. She will likely receive a warm reception from her counterparts, buoyed by the unexpectedly positive GDP figures released earlier today, indicating a 0.5 percent increase for February. However, this figure reflects a time before the implementation of new tariffs.

The pressing question is how much European considerations will influence Reeves as she refines her economic strategy in light of the newly emerging tariff landscape shaped by the Trump administration.

As we navigate through these changes, the rhetoric of Labour leaders like Keir Starmer and Reeves, which emphasizes a transformed global landscape and the potential end of globalization, does not always align with the realities of their strategies. Starmer recently stated, Our plans dont so much change as turbocharge, indicating that while the overarching economic framework remains intact, there may be an acceleration of initiatives. High-level discussions among Reeves and her allies in recent days have focused on practical implementations of these plans, hinting at a series of new initiatives expected after Easter. The upcoming EU/UK summit on May 19 is anticipated to play a crucial role in discussions aimed at stimulating economic growth.

At this summit, one of the primary topics will likely be enhancing cooperation between the UK and EU on defense matters. This includes procurement arrangements that would enable British companies to gain access to a new European fund aimed at rearming the continent in response to escalating Russian threats. A Treasury official stated, The Chancellor will be travelling to Warsaw to advocate for deeper defense financing cooperation with our European allies, ensuring we achieve greater economic and national security in a world that has fundamentally changed.

Beyond defense, Reeves is also seeking to push forward the idea of an EU reset, aimed at eliminating additional barriers to trade. She has even proposed alignment with specific EU regulationsan idea that some Brexit supporters may find controversialparticularly in established sectors such as chemicals.

Looking ahead, the governments recent commitment to streamline decision-making processes in Whitehall has taken on new significance, especially following the Cabinet Office's announcement to cut nearly a third of its staff. This move sets a potentially alarming precedent for future public sector job cuts.

Furthermore, Reeves is focused on expediting her modern industrial strategy, which aims to support eight specific growth sectors while simultaneously offering some protection to industries vulnerable to the economic volatility created by the Trump administration. However, insiders involved in developing this strategy have expressed skepticism, labeling it as a red herring. They emphasize that without adequate financial backingdetails of which will remain unclear until the spending review in Junethe strategy may struggle to achieve its objectives.

As discussions on deregulation and the elimination of quangos intensify in the coming weeks, both Reeves and Starmer are acutely aware that any supply-side reforms may not be sufficient to counteract the detrimental effects of a global trade war and its resulting impact on public finances.

Amidst these challenges, there is a growing sense of pessimism within Whitehall regarding the possibility of negotiating down the 10 percent baseline tariff imposed on Britain and other countries by the Trump administration. Instead, Starmer and his ministers are prioritizing efforts to negotiate the reduction of the more significant 25 percent tariff on British cars.

Lord Peter Mandelson, the UK ambassador in Washington, along with British negotiators, continue to advocate for a broader economic agreement that includes collaboration on technology, artificial intelligence, and space exploration. However, it is becoming increasingly evident that any meaningful agreement may take considerable time to materialize.

A British official succinctly summarized the situation: They still have to clarify among themselves what they do next, with whom, and how. This is a journey, a process, not an event where policy, politics, and markets are all intertwined. If Trump remains unwilling to negotiate the essential 10 percent baseline tariff affecting Britain, this may alleviate some pressure on Starmer to offer politically sensitive concessions to the US president in pursuit of a more ambitious trade deal.

In a recent address to Congress, Jamieson Greer, the US trade representative, clearly articulated dissatisfaction with the UKs agricultural barriers, bringing us back to contentious topics like hormone-treated beef and chlorine-washed chicken. For further insights, tune into our extensive end-of-term Political Fix podcast featuring Lucy Fisher, Miranda Green, and our Markets specialist Katie Martin. We also encourage listeners to submit questions for our upcoming Q&A at politicalfix@ft.com.

As we approach the Easter holiday, I encourage everyone to take some time to enjoy the beauty of the English countryside, especially the serene Exmoor coast path, a stunning stretch of coastline renowned for its picturesque landscapes and delightful pubs. I fondly recall many youthful walks along this path, and recent stunning photographs shared by our colleague Jim Pickard serve as a reminder of its beauty.

For those seeking indoor entertainment, I highly recommend attending the Royal Shakespeare Companys production, Kyoto. This play cleverly combines high drama with humor, shedding light on the political negotiations leading up to the pivotal COP3 environmental treaty and is currently being staged at Soho Place, an exciting new theater in London's West End. The production features Stephen Kunken, who guides the audience through the intricate complexities of climate negotiations from the perspective of a savvy lawyer lobbying for the oil industry, while the late John Prescott emerges with significant acclaim in the narrative.