UBS On-Air: Market Moves UBS On-Air: Paul Donovan Daily Audio 'Independence Day'
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Jul 25, 2025 The discussion dives into the independence of the Federal Reserve, highlighting the tensions with political figures like President Trump. It raises intriguing points about how trade taxes affect consumer costs. The podcast also explores shifts in consumer behavior, particularly within Republican demographics, and analyzes Japan's minor inflation declines. Additionally, it looks at food prices and their role in inflation, along with potential economic indicators emerging from the UK and Germany.
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Fed's Independence Protected
- Federal Reserve Chair Powell defends the Fed's independence despite political pressures.
- Powell publicly corrects President Trump on Fed building project issues and tariff impacts.
Tariffs Hurt US Consumers
- Some Fed cost overruns are due to tariffs imposed on inputs for their building project.
- US consumers, not foreign exporters, ultimately bear these tariff costs.
Complex Durable Goods Trends
- Durable goods orders are complex due to recent factory building booms and uncertainty slowing expansion.
- Consumers' durable goods purchases vary by political affiliation, affecting purchase patterns.