Beyond Markets

US assets slumped last week, with the US dollar, Treasuries, and stocks selling off following President Trump's warning of fresh tariffs on the European Union. The pessimism on US assets is also reflected in recent data. The preliminary University of Michigan consumer sentiment index dropped to 50.8 from 52.2 in the month, and surveys show that Americans intend to do fewer road trips this summer despite falling gasoline prices.Investors are now seeing merit on diversifying out of the US, and gains have been seen in local currency stocks and bond markets. Local currencies have also performed well, with the weaker greenback creating opportunities for Asian central banks, such as Bank Indonesia and the Reserve Bank of Australia, to cut rates. In Hong Kong, the slump in the US dollar pushed the Hong Kong dollar towards the strong end of the band, prompting intervention from the Hong Monetary Authority (HKMA) to defend the currency peg. We expect more abrupt interventions from the HKMA from here, as investor positioning and flows are likely to weigh on the Hong Kong dollar and HIBOR.This episode is presented by Magdalene Teo, Head of Fixed Income Research Asia at Julius Baer.

In this episode of the Week in Markets, equities research analyst Louis Chua explores how the equity and debt markets have reacted to the 90-day truce in the trade war between the US and China, and what are some of the lingering concerns to watch over the next 90 days. Overall, while the financial markets have reacted with relief, we believe that the US fiscal situation remains far from being solved, and we would take advantage of the current opportunity to add diversifying exposure outside the US. In the long term, an end to US exceptionalism and foreign investors’ asset allocation decisions to diversify away from the US can have a significant impact to equity and fixed income markets.

The US and China have agreed to a 90-day truce in the trade war, following negotiations in Geneva. As part of the deal, the US will reduce tariffs on Chinese imports from 145% to 30%, and China will lower its duties on American goods from 125% to 10%. Markets have welcomed these developments, but key questions still remain about the implications for the economy and inflation. This uncertainty puts the Federal Reserve (Fed) in a tough spot, and we await more clarity on the Fed’s direction from Fed Chair Jerome Powell’s comments on 15 May.   In Asia, the India–Pakistan conflict has calmed following a US-mediated ceasefire. We note that historically markets have typically recovered within a month of previous India-Pakistan conflicts, and continue to monitor key indicators such as the Indian Rupee and Foreign Institutional Investor (FII) flows, as well as geopolitical developments.   This episode is presented by Chintan Bhindora from the Julius Baer Research Asia team.

Tune in for insights on the impact of recent elections on global markets. The discussion touches on how voter preferences for incumbents are shifting capital towards gold, European equities, and Chinese stocks. Historical trends favor a 'Sell in May' strategy, suggesting a reconsideration for risk-averse investors. With upcoming monetary policy decisions looming, market participants are in wait-and-see mode. It's a fascinating look at how geopolitical events shape investment strategies.

US markets rebound as optimism grows over trade talks and a softer stance from President Trump. Manufacturing indicators, however, hint at potential contraction, raising concern. Polls show a majority disapprove of tariffs, fearing inflation. Meanwhile, analysts predict rate cuts could materialize as recession risks rise. Insights into investment strategies and currency movements enrich the discussion as the landscape shifts.

US President Donald Trump escalated his open criticism of Federal Reserve chair Jerome Powell on Monday, sparking concerns about the central bank’s independence. Meanwhile,​​Trump is also ramping up pressure on China, imposing fresh restrictions on the export of Nvidia's H20 AI chips. However, the University of Michigan consumer survey indicates that US consumer sentiment is rapidly declining, arguably placing him under growing pressure to strike a deal with Beijing.This episode is presented by Richard Tang, China strategist and Head of Research, Hong Kong at Julius Baer.

The yield on the benchmark 10-year US Treasury moved up 50 basis points last week, representing one of the most significant single-week increases on record. As the US administration's unpredictable tariff policies continue to unsettle markets, how can investors navigate this challenging investment landscape?Steve Wang, Fixed Income Specialist Asia at Julius Baer, sits down with Esteban Burbano, Managing Director and Fixed Income Strategist at PIMCO, to discuss the current economic picture, the impact of tariffs on inflation expectations and how the Federal Reserve might respond, the state of the US Treasury market, and the opportunities in the fixed income market amidst this unprecedented volatility.(This episode was recorded on 17 April 2025)

US President Trump’s Liberation Day tariff announcements sent shockwaves through financial markets and 2 April 2025 will certainly be remembered as a hugely significant day. But what are the implications for investors in the wake of all the tariff-related uncertainty? In this episode, Christian Gattiker, Head of Research at Julius Baer, talks to Helen Freer about navigating the world of investing post-Liberation day. They discuss the risk of a recession, the role of US and non-US assets in portfolios, the outlook for safe-haven assets including the US dollar, and much more.00:31 Introduction01:07 Has the risk of a US and global recession increased?03:24 What is the expected timeline now?05:20 Is it possible to say what Trump’s plan is?06:41 The US Federal Reserve’s dilemma08:14 Impact on capital flows to the US09:49 Adjusting exposure to US and non-US assets10:58 Where do US technology stocks go from here?12:36 The outlook for the US dollar now15:21 The reaction of the Swiss franc and the Japanese yen16:23 Historic moves in bond markets18:46 What to focus on now in the fixed income space20:19 Thoughts on gold in the current environment22:16 What does the situation mean for Swiss equities?23:38 The role of Chinese equities in a portfolio26:44 The significance of talks between the EU and China27:49 Exposure to India to increase portfolio diversification29:02 The relevance of the Q1 earnings season30:29 Oil prices under pressure31:48 Our expectations for the rest of the year33:31 OutroWould you like to support this show? Please leave us a review and star rating on Apple Podcasts, Spotify or wherever you get your podcasts.

Recent spikes in Treasury yields, public criticism from Republican mega-donors on the tariff policy, and calls by Wall Street CEOs to the White House and the Treasury Secretary, seem to have caught the White House’s attention. Reciprocal tariffs on all countries (excluding China), and tariffs on many electronics goods have been paused. Investors are taking some comfort in the White House’s attentiveness to the Treasury market. But until the tariff issues are resolved, significant uncertainty will continue to weigh on the market.

As global markets reel from the fallout of the "Liberation Day" tariff announcements, gold is once again thrust into the spotlight. Despite a recent pullback amidst the market turmoil, the yellow metal has risen by around 20% overall in the past six months and continues to chart new highs.In this episode of the Beyond Markets podcast, Chris Irwin, Head of FX and Precious Metals Trading and Carsten Menke, Head of Next Generation Research at Julius Baer, examine the rising demand of gold as a safe haven asset, continued central bank buying flows, and the factors behind the recent volatility.