With the Oval Office confirming the deal last night, Tokyo’s Nikkei 225 was up 3.5% in trading today with the Japanese yen holding steady at 0.0068 JPY to the U.S. dollar.

In Europe, London’s FTSE 100 was up 0.6% this morning with Germany’s DAX up near 0.9%.

Touting the agreement as a “great deal for everybody,” the president took to Truth Social, his social media site, to share some of the early details: “Japan will invest … $550 billion into the United States, which will receive 90% of the profits.”

He added: “Perhaps most importantly, Japan will open their country to trade including cars and trucks, rice and certain other agricultural products, and other things.”

Moreover, Japanese exports to the U.S. will face tariffs of 15%—well below the 24% Trump first threatened on “Liberation Day.”

“This is a very exciting time for the United States of America, and especially for the fact that we will continue to always have a great relationship with the country of Japan,” Trump added.

The news that the White House is still signing deals with key trading partners with a little over a week until Aug. 1—the date outlined in the president’s so-called letter tariffs sent earlier this month—has boosted confidence that more deals could still come ahead of the deadline, wrote Deutsche Bank’s Jim Reid this morning.

That being said, Reid cautioned that markets may not get their reprieve in a timely manner. In the note seen by Fortune, he added: “Collectively, this more positive trade news has really helped to ease investor fears that tariffs are about to snap back higher on August 1. But of course, the threat of much higher tariffs still remains for several large economies, including the 30% on the EU, 35% on Canada, and 50% on Brazil. And there’s also the pledge of higher sectoral tariffs, including 50% on copper, so this is far from the end just yet, and those tariffs would each have a significant impact if they did come in.

“We also know from experience that we might not know the outcome until hours before the deadline, which happened in early February where the 25% tariffs on Canada and Mexico were postponed for 30 days on the day before they were due to be implemented.”

Indeed, UBS global wealth management CIO Mark Haefele wrote in a note this morning: “The U.S.’s deal with Japan is better than market expectations, as the lower tariffs on autos could translate into a 0.4pp improvement in Japan’s real GDP growth this year and again in 2026. The deal reduces risks to Japan’s economic growth, in our view, and removes downside risks for the Japanese currency.”

However, the bigger picture is continued uncertainty, as he added: “We expect market volatility to pick up in the lead-up to the 1 August tariff deadline, with threats to Federal Reserve independence and geopolitical uncertainty lingering in the background.”

Are markets pricing in Aug. 1?

The general take on Wall Street at present is that Trump won’t push ahead with his threats come the end of the month.

Goldman Sachs’ Jan Hatzius, for example, wrote in a note this week: “We don’t expect the ‘letter tariffs’ scheduled for August 1 to take effect,” while Deutsche Bank added: “It’s clear that markets aren’t pricing in the proposed August 1 rates.”

But this reliance on the TACO (Trump Always Chickens Out) trade may prove fatal, the likes of JPMorgan’s Jamie Dimon have cautioned.

Indeed, analysts from Deutsche Bank have warned it’s precisely because of this confidence from the markets that President Trump may push ahead with his plan—believing that the economy may be stable enough to take the change.