The Globe and Mail reports in its Friday edition that the S&P 500, FTSE 100 and MSCI All Country index have reached new highs this week, with major banks like Goldman Sachs raising their year-end S&P 500 forecasts by up to 10 per cent. A Reuters dispatch to The Globe reports that the key factor is that baseline tariffs on imports to the U.S. will be significantly lower than previously threatened. Tariffs on Japanese goods will be set at 15 per cent instead of 25 per cent, and a similar rate is expected for the European Union. The outlook has improved considerably. Economists predict that the final U.S. tariff rate will be about 15 to 20 per cent after deals with Brussels and Beijing, a level that markets believe will not lead to a recession. Despite market optimism, the average U.S. tariff on imported goods was about 2.5 per cent as of Dec. 31 last year. Even if it rises to the expected 15 to 20 per cent, it will still be at least six times higher than just a few months ago, marking the highest level since the 1930s. It is hard to see how this would not be detrimental to growth. Annex Wealth Management economist Brian Jacobsen says, "'It could have been worse' is not a good foundation for a market rally."