UBS On-Air: Market Moves Macro Monthly Podcast with UBS Asset Management
May 16, 2025
Fatu Konteh, an Investment Strategist at UBS Asset Management, dives into the complexities of the current global macroeconomic landscape. She discusses the disparity between consumer sentiment and real economic activity while noting the labor market's surprising resilience. The conversation shifts to the recent market rebound fueled by tariff negotiations and its implications for small businesses, as well as the global repercussions of U.S. tariff policies affecting nations like China and Germany.
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Mixed Signals in Economic Data
- Soft data like consumer and business confidence look poor, but hard economic data remains strong for now.
- The private sector's strong balance sheets may cushion a slowdown, leading to a mild recession if any.
Tariff Constraints Fuel Market Rebound
- Markets rebounded strongly because of constraints on Trump's tariff policy.
- Bond market reactions and political pressures limit drastic tariff actions, reassuring investors.
Tariff Impact Spurs Domestic Support
- Tariffs hurt open economies like China but also spur domestic supportive policies in affected countries.
- This "Trump paradox" causes regions like Germany and Canada to increase spending and reforms, cushioning economic impact.