UBS On-Air: Market Moves UBS On-Air: Paul Donovan Daily Audio 'Real slowdown risks'
7 snips
Apr 22, 2025 The podcast explores how President Trump's call for lower interest rates is shaking markets and raising concerns about the independence of the Federal Reserve. It highlights how the US faces an economic slowdown fueled by staggering uncertainties rather than just high rates. Additionally, the discussion covers how central bank policies impact investments and consumer sentiment, as well as the contrasting roles of the euro and dollar in today’s market. Tune in for insights on navigating the complex landscape of risks and inflation!
AI Snips
Chapters
Transcript
Episode notes
US Slowdown Driven by Risk
- The US economic slowdown this year is driven more by rising uncertainty and risk than by high credit costs.
- Trump's policies increase inflation and uncertainty, reducing consumers' spending power and investment willingness.
Inflation Impact on Real Interest Rates
- Negative real interest rates could emerge in the US this year but won't necessarily ease borrowing costs.
- Tariffs cause inflation that reduces disposable income rather than increasing consumer or corporate income.
Tariffs and Uncertainty Weigh on Investment
- Erratic policy and tariff-driven inflation increase uncertainty, discouraging corporate investment.
- Consumers do not benefit from tariffs even if corporations raise prices using tariffs as justification.