UBS On-Air: Market Moves Top of the Morning: CIO Strategy Snapshot - Summer slowdown?
Jul 21, 2025
In this engaging conversation, Jason Draho, Head of Asset Allocation Americas at UBS Chief Investment Office, dives into the current market dynamics. He discusses the potential impacts of evolving US trade policies and inflation data on consumer spending. Jason highlights the mixed signals from the Q2 earnings season, with many companies exceeding estimates. He also reflects on the political pressures facing the Federal Reserve and their implications for monetary policy. The podcast wraps up with an optimistic outlook for key sectors like financials and tech.
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Tariffs Impact Inflation Resilience
- Tariffs are beginning to impact U.S. inflation, pushing core goods prices higher than in three years.
- Despite this, core service inflation remains steady, signaling the economy's underlying resilience.
Risks of Firing Fed Chair
- Firing Fed Chair Powell could create legal and market chaos, undermining Fed independence.
- Such action would likely increase risk premiums, pushing yields higher and equities lower.
Strong Q2 Earnings Start
- Around 80% of companies reporting Q2 earnings have beaten expectations, with guidance generally positive.
- Banks show improved credit conditions and no signs of consumer weakness, reflecting economic resilience.