Bloomberg Surveillance Bloomberg Surveillance TV: July 18th, 2025
Jul 18, 2025
In this discussion, Christopher Waller, a Federal Reserve board member, tackles the complexities of the labor market, emphasizing its unpredictable nature amidst mixed signals. Paul Atkins, SEC Chairman, dives into the evolving landscape of stablecoin regulations and crypto oversight. Sonal Desai from Franklin Templeton offers insights on anticipated interest rate cuts and their implications for the economy. Together, they dissect the interplay of monetary policy and inflation, painting a vivid picture of the current financial landscape.
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US Equity Valuation Premium
- The US equity market's valuation premium is high but hard to justify when other markets gain growth momentum.
- This suggests investors have an opportunity to diversify their portfolios to include Europe and emerging markets.
Currency's Role in Market Diversification
- Currency effects create a tailwind for US tech earnings but a headwind for Europe and Asia earnings.
- Investors are increasingly diversifying internationally to benefit from these currency and market dynamics.
Interest Rate Cycle Differences
- Europe is expected to cut rates more quickly but from a lower level than the US.
- Long-term rates remain high due to debt sustainability concerns despite policy rate cuts.