FT News Briefing US investment banking is so back
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Jul 17, 2025 Donald Trump questioned the future of the Federal Reserve's leadership, stirring political discussion. Meanwhile, Wall Street celebrated a surprising rebound in investment banking fees, highlighted by Goldman Sachs' impressive profits. On the global stage, the UK's inflation rate surged unexpectedly, reaching an 18-month high, while Japan's bond market faced volatility amid electoral uncertainties. These dynamics hint at shifting strategies and market expectations in an unpredictable economic landscape.
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Fed Chair Firing Sparks Market Worry
- President Trump publicly questioned whether he should fire Fed Chair Jay Powell, shaking investor confidence.
- Markets worry that political interference could lead to less independent monetary policy and higher long-term inflation.
Investment Banking Rebounds Despite Uncertainty
- Investment banking fees beat expectations in Q2 despite earlier fears from trade war uncertainty.
- Dealmakers adapted to the 'new normal' of political uncertainty, driving renewed dealmaking activity.
Cautious Optimism for Deal Recovery
- Investors should be cautious and not overestimate the recovery in investment banking yet.
- They need to monitor the evolving impact of trade war threats on dealmaking activity closely.