Portfolio Update – August 2025

General news

• On 01/08/2025, U.S. inflation, measured by the Fed’s preferred Personal Consumption Expenditures (PCE) index, rose to 2.6% annually in June from 2.4% in May, with core inflation steady at 2.8%, partly driven by President Trump’s tariffs. Monthly prices increased 0.3%, above the pace consistent with the Fed’s 2% target, as higher costs for gas, groceries, and imported goods like furniture and appliances outweighed declines in some services. The data reinforced the Fed’s decision to keep interest rates at 4.25%-4.5%, with Chair Jerome Powell citing persistent inflation and uncertainty over tariff impacts. Consumer spending and income both rose 0.3% in June but showed minimal inflation-adjusted gains, reflecting cautious spending despite 3% GDP growth in Q2. The hotter-than-expected inflation reading has reduced the likelihood of a September rate cut.
• President Trump announced he will maintain current U.S. tariffs on Mexican goods for 90 days to allow time for trade negotiations, delaying a planned increase from 25% to 30% on imports. Mexico will continue facing a 25% tariff on cars, a 25% “Fentanyl Tariff,” and 50% tariffs on steel, aluminum, and copper, while agreeing to remove unspecified non-tariff trade barriers. The decision followed what Trump described as a “very successful” call with Mexican President Claudia Sheinbaum, highlighting Mexico’s importance as a key trading partner and the strong working relationship between the two leaders. Talks are expected to continue with the goal of reaching a trade deal within the extension period.
• President Trump’s updated “reciprocal” tariffs, set to take effect Aug. 1, were announced quietly via an evening executive order, in stark contrast to the grand Rose Garden unveiling of the first round in April. The low-key rollout may signal that the White House sees less impact in staging dramatic tariff announcements a second time, or that it is comfortable leaving some nations with higher tariffs, as tariff revenue has boosted the U.S. Treasury and inflation fears have eased. With no new trade deals from the earlier “90 deals in 90 days” pledge and few details released so far, the subdued approach leaves the rationale open to speculation.
• On 02/08/2025, U.S. nonfarm payrolls rose by just 73,000 in July, missing expectations and accompanied by sharp downward revisions to May and June job gains, while the unemployment rate edged up to 4.2%. Weak hiring was concentrated in health care (+55,000) and social assistance (+18,000), which accounted for most of the month’s growth, while federal government, professional, and business services saw declines. The soft report, coupled with deteriorating labor market signs, boosted market expectations of a Federal Reserve rate cut in September to 75.5% from 40% a day earlier. Average hourly earnings rose 0.3% on the month and 3.9% year-over-year, slightly above forecasts.
• President Trump fired Bureau of Labor Statistics Commissioner Erika McEntarfer on Friday, hours after the agency reported weak July job growth of 73,000 and sharp downward revisions to previous months. Trump accused McEntarfer, a Biden appointee, of manipulating jobs data to favor Democrats and said she would be replaced by Acting Commissioner William Wiatrowski. The move drew criticism from economists and former BLS officials, who warned it undermines the bureau’s independence. The firing came as markets fell sharply and recession fears grew, with the weak report boosting expectations of a September Fed rate cut. Trump also renewed attacks on Fed Chair Jerome Powell, accusing him of politically motivated interest rate decisions and calling for his removal.
• On 03/08/2025, The U.S. has imposed a 35% tariff on Canadian goods not covered by the USMCA, citing Canada’s alleged failure to curb fentanyl smuggling. Canadian Trade Minister Dominic LeBlanc said he remains optimistic a deal to reduce tariffs is possible and expects Prime Minister Mark Carney to speak with President Trump “in the next number of days.” LeBlanc noted progress in talks with U.S. Commerce Secretary Howard Lutnick and Trade Representative Jamieson Greer, emphasizing the goal of securing an agreement that lowers tariffs and boosts investment certainty. Carney countered that Canada accounts for only 1% of U.S. fentanyl imports and is working to cut that further.
• On 05/08/2025, India accused the U.S. and EU of unfairly targeting it over Russian oil imports after President Trump threatened steep new tariffs, potentially 25%, on Indian exports. New Delhi argued it began buying Russian oil only after Europe redirected its own supplies following the Ukraine war, and noted both the U.S. and EU still trade with Russia in various goods. India is now Russia’s top oil buyer, importing 1.8 million barrels per day in 2023, a shift the U.S. once encouraged to stabilize global energy prices. Citing EU trade figures far exceeding India’s, and pointing to ongoing U.S. imports of Russian uranium, palladium, fertilizers, and chemicals, India called the criticism “unjustified” and vowed to safeguard its economic interests. Analysts say a U.S.-India trade deal is unlikely given wide policy differences, with some in India suggesting allowing U.S. tariffs to proceed and redirecting exports elsewhere.
• On 06/08/2025, President Trump said he will announce new tariffs on semiconductors and chips within the next week to encourage U.S. production, without providing further details. The move comes amid soaring global demand for advanced chips, most of which are produced in Taiwan by companies like TSMC that supply Apple, Nvidia, Qualcomm, and AMD. It follows Trump’s recent executive order imposing higher tariffs on imports from multiple countries, including a 20% duty on Taiwanese goods starting this week. In the same CNBC interview, Trump suggested imported pharmaceutical tariffs could reach 250%, up from his earlier 200% cap, and claimed strong public support for his tariff policies despite declining approval ratings in recent polls.
• BMO economists warned of stagflation after July’s ISM Services Index fell to 50.1 from 50.8, with declines in inventories, new orders, employment, imports, and exports, alongside rising inflation pressures. They said the data, combined with weak job growth, shows the economy is struggling under higher tariffs and policy uncertainty, and predicted the Federal Reserve may cut rates in September to support a weakening labor market despite elevated prices.
• On 07/08/2025, President Trump announced plans for a 100% tariff on imported semiconductors, excluding companies manufacturing in the U.S., but key policy details remain unclear. Experts say it’s too early to gauge the full impact, though major players like TSMC and Samsung—who have invested heavily in U.S. facilities—may be exempt. This could benefit large chipmakers while disadvantaging smaller firms. Uncertainty remains about whether the tariffs will target only raw chips or also consumer products and components containing semiconductors, raising concerns across the broader tech and electronics supply chain.
• The White House has imposed an additional 25% tariff on Indian imports, raising the total to 50%, in response to India’s continued purchase of Russian oil. The move, announced by President Trump, is part of a broader strategy to penalize countries supporting Russia amid the Ukraine conflict. India called the tariffs unfair and emphasized its energy imports are market-driven and necessary for national security. The action marks one of the highest U.S. tariffs on a trading partner and could signal more penalties for other countries buying Russian oil, as the administration reviews global trade ties linked to Moscow.
• Apple CEO Tim Cook and President Trump announced that Apple will invest an additional $100 billion in U.S. companies and suppliers over the next four years, adding to a previous $500 billion commitment. The investment aims to strengthen U.S. manufacturing and build a domestic chip supply chain, including partnerships with Corning, Coherent, Texas Instruments, and others. Apple highlighted plans for glass production, chip fabrication, and wireless charging components to be based in the U.S., with the goal of achieving an “end-to-end” supply chain on American soil. Cook noted that many key iPhone components are already U.S.-made.
• On 08/08/2025, President Donald Trump has announced plans to impose a 100% tariff on imported semiconductors, excluding companies building in the U.S., but has yet to clarify key policy details. Experts say the impact remains uncertain, particularly regarding what qualifies a company for exemption and which products will be affected. Major chipmakers like TSMC and Samsung, which have invested heavily in U.S. manufacturing, are expected to benefit, potentially consolidating market share among top players. However, analysts warn that ambiguity around whether tariffs apply to raw chips, end devices, or components could significantly disrupt the broader electronics supply chain.
• On 09/08/2025, Canada’s unemployment rate held at 6.9% in July as the country lost 41,000 jobs, mainly among youth aged 15 to 24. Job declines were led by information, culture, recreation, and construction sectors, with Alberta and British Columbia seeing the largest losses, partly offset by gains in Saskatchewan. Total hours worked were little changed, while average hourly wages rose 3.3% to $36.16. The labor market has stagnated amid growing uncertainty from U.S. tariffs on Canadian goods and services.
• Gold prices dropped from a record high after the White House announced plans to clarify “misinformation” about tariffs on gold bars. Gold futures fell from $3,491.30 to $3,463.30 following concerns raised by the Swiss Precious Metals Association, which warned U.S. tariffs could disrupt global gold trade. President Trump’s 39% tariff on Swiss exports includes 1kg and 100oz gold bars, with the rule applying to imports from all countries, not just Switzerland, the world’s largest gold refiner.
• On 12/08/2025, President Trump delayed the return of high U.S. tariffs on Chinese goods for 90 days, extending the deadline to mid-November following trade talks in Stockholm. Without the extension, tariffs would have reverted to April’s peak levels of 145% on Chinese imports and 125% on U.S. goods. Since May, both countries have kept reduced tariffs—30% for the U.S. and 10% for China—though Trump’s frequent tariff changes have created uncertainty for businesses. He also urged China to quadruple U.S. soybean purchases to reduce its trade deficit, boosting Chicago soybean prices, though no agreement has been confirmed.
• President Trump announced that gold will not be subject to tariffs, overturning a U.S. Customs ruling that 1-kilogram and 100-ounce gold bars from Switzerland—and other countries—would face a 39% duty. The initial decision, which aimed to apply Trump’s “reciprocal tariffs” policy, raised concerns from the Swiss Precious Metals Association about disrupting global gold flows. Following Trump’s statement, gold futures fell 2.48% to $3,404.70 per ounce, after hitting a record high days earlier.
• Nvidia and AMD have agreed to give the U.S. government 15% of revenues from certain chips sold in China in exchange for export licenses to sell Nvidia’s H20 and AMD’s MI308 chips there, the Financial Times reported. The deal, following Nvidia CEO Jensen Huang’s meeting with President Trump, reflects the White House’s willingness to make exceptions amid Trump’s aggressive tariff policies, including his recent threat of a 100% tariff on semiconductors not made in the U.S.
• The Reserve Bank of Australia has cut interest rates by 0.25 percentage points to 3.6%—its third reduction in 2025—following earlier cuts in February and May. The unanimous August decision, driven by easing inflation and slightly weaker labour market conditions, marks a total 75-basis-point drop this year. Updated forecasts suggest inflation will moderate to the 2–3% target midpoint, supporting a gradual easing path after rates peaked at 4.35% in late 2023.
• On 13/08/2025, U.S. inflation rose slightly less than expected in July, with CPI up 0.2% monthly and 2.7% annually, easing market fears and boosting expectations of a September Fed rate cut. Core CPI rose 0.3% on the month and 3.1% year-over-year, driven mainly by shelter costs, while food prices were flat and energy fell. Tariffs under President Trump showed modest effects, with some categories like household furnishings rising but others, such as apparel and canned goods, barely moving. The report comes amid political tension over the Bureau of Labor Statistics, which faces budget cuts, staffing shortages, and criticism from Trump, who has nominated a new commissioner. Economists remain divided on whether tariffs will cause temporary or lasting inflation pressures.
• U.S. stocks hit record highs Tuesday after softer-than-expected inflation data boosted hopes for a September Fed rate cut. The S&P 500 rose 1.13% to 6,445.76, the Nasdaq gained 1.39% to 21,681.90, and the Dow added 1.10% to 44,458.61. July CPI rose 2.7% annually versus the 2.8% forecast, while core CPI climbed 3.1%, slightly above estimates. Rate cut odds for September jumped to 94%, with traders also betting on additional cuts in October and December. Small caps led gains, and optimism grew as Trump extended a 90-day pause on higher tariffs for Chinese goods. Markets now look ahead to Thursday’s PPI data, the Fed’s Jackson Hole event, and its September meeting.
• On 14/08/2025, The U.K. economy grew 0.3% in Q2 2025, beating forecasts of 0.1%, driven mainly by services, construction gains, and a June rebound after weak April–May activity. GDP rose 0.4% in June following a 0.1% May contraction, with strong contributions from scientific R&D, engineering, electronics manufacturing, and car sales. Economists warn the momentum may not last due to a softening labor market, global weakness, tax-related investment drags, and cautious consumer sentiment. The Bank of England is expected to keep rates steady for the rest of the year, though some see upside risks to 2025 growth forecasts.
• On 15/08/2025, U.S. wholesale prices surged in July, with the Producer Price Index rising 0.9%—the largest monthly gain since June 2022—far above expectations, signaling persistent inflation pressures. Core PPI also jumped 0.9%, while annual PPI climbed 3.3%, driven mainly by services, trade margins, and machinery wholesaling. The spike comes amid Trump administration tariffs, with analysts warning businesses may soon pass higher costs to consumers despite CPI remaining relatively stable. Markets reacted with lower odds of aggressive Fed rate cuts this year, while the White House claimed tariffs weren’t yet impacting consumer prices. The report also highlighted growing scrutiny over BLS data accuracy following leadership changes, budget cuts, and methodology adjustments.
• On 16/08/2025, Trump and Putin held a nearly three-hour summit in Alaska but failed to reach a deal to end Russia’s war in Ukraine, though Trump called the talks “very productive” with some progress on key points. Putin warned Ukraine and Europe not to undermine the negotiations, while Trump stressed his goal was to get both sides to the table, not to negotiate on Ukraine’s behalf. Zelenskiy and European allies, wary of a potential freeze recognizing Russian-held territory, were not invited. Trump said he will brief Zelenskiy and NATO leaders, reiterating his push for a rapid ceasefire while Zelenskiy continues to reject territorial concessions and seeks U.S.-backed security guarantees.
• Analyst Gil Luria said U.S. government intervention in Intel is necessary for national security, as the company struggles and the country relies heavily on foreign chipmakers like TSMC and Samsung. Reports suggest the Trump administration may take a stake in Intel using CHIPS Act funds, after the company already received nearly $11 billion in subsidies. Luria argued Washington should get equity if it provides more support, while Intel’s CEO Lip-Bu Tan met Trump amid calls for his resignation over alleged China ties. The push aligns with Trump’s goal of boosting domestic chip production, with experts warning that AI’s risks make securing U.S. chipmaking capacity as critical as nuclear defense.
• On 18/08/2025, U.S. special envoy Steve Witkoff said Russia agreed to let the U.S. and Europe provide Ukraine with “Article 5-like protection,” marking a major shift in peace talks between Trump and Putin. While European leaders and Zelenskyy welcomed the move, concerns remain as no ceasefire was reached, and Trump has suggested a deal could involve Ukraine ceding the Donbas—something Kyiv firmly rejects. Secretary of State Marco Rubio warned progress was made but a peace deal is still far off, with disputes over territory, borders, and long-term security guarantees unresolved. Trump is set to meet Zelenskyy and European leaders next.
• On 19/08/2025, The Trump administration has expanded its 50% steel and aluminum tariffs to cover 407 more product categories, including auto parts, machinery, construction materials, fire extinguishers, and specialty chemicals. Officials say the move closes loopholes and strengthens U.S. steel and aluminum industries, but experts warn it now affects at least $320 billion in imports—up from $190 billion—likely fueling higher prices and inflation. The White House said the expansion was expected after a product review process launched earlier this year.
• Bankruptcy filings in the U.S. have surged to their highest level since the 2020 pandemic, with 71 companies filing in July—up from 63 in June—according to S&P Global. Well-known brands like Forever 21, Joann, and Del Monte Foods are among those affected, struggling with weak demand, heavy debt, high inventory costs, and elevated interest rates. Despite solid GDP growth, uncertainty from tariffs and supply chain pressures is weighing on businesses. August has already seen major bankruptcies, including fashion retailer Claire’s, marking its second Chapter 11 filing.
• U.K. inflation rose to 3.8% in July, slightly above expectations, driven by higher airfares, fuel, and food prices, according to the ONS. Core inflation also climbed to 3.8%, while services inflation hit 5%, raising concerns for the Bank of England as it tries to manage wage and tax-related cost pressures. The increase reduces the likelihood of further rate cuts this year, despite the BOE’s recent move to lower rates to 4%. Economists expect inflation to peak near 4% in September before gradually easing, though sticky price pressures may delay progress toward the BOE’s 2% target until late 2026.
• On 21/08/2025, At their July meeting, Federal Reserve officials expressed concern over both inflation and a weakening labor market but largely agreed it was too early to cut interest rates, despite dissent from two governors who pushed for reductions. Minutes showed debate over inflation risks from Trump’s tariffs and employment slowdowns, with officials warning of difficult trade-offs if inflation persisted while jobs weakened. This marked the first multiple-governor dissent in over 30 years. With payroll growth slowing and political pressure from Trump intensifying, attention now turns to Chair Jerome Powell’s Jackson Hole speech for signals on future policy.
• On 22/08/2025, Fed Chair Jerome Powell will deliver a key address Friday at the Jackson Hole symposium, a platform where he can outline long-term policy goals on inflation and employment. This year’s speech is especially significant, as it may be one of his last before his term ends in May 2026. Despite President Trump’s threats to remove him, legal protections safeguard Powell’s role. Political pressure on the Fed remains high, with the DOJ now investigating Governor Lisa Cook. The symposium, usually a niche event for economists, carries added weight this year amid debates over central bank independence.
• On 23/08/2025, At Jackson Hole, Fed Chair Jerome Powell signaled possible rate cuts ahead but stressed caution amid uncertainty from tariffs, trade, and policy shifts. He said risks are rising despite strong employment and resilience, with stagflation a concern. Powell emphasized Fed independence, rejecting political pressure for aggressive cuts, while noting the benchmark rate remains at 4.25%–4.5%. Markets rallied on his comments, viewing them as a step toward easing. He also reflected on lessons from the Fed’s 2020 framework review, reaffirming the 2% inflation target after past missteps.
• President Donald Trump said he will fire Federal Reserve Governor Lisa Cook if she does not resign, citing allegations of mortgage fraud now under DOJ investigation. If removed, Trump could appoint her successor, further shaping the Fed board in line with his monetary stance. Critics, including Sen. Elizabeth Warren, argue Cook is being targeted as a political scapegoat, while supporters note she has consistently voted with Chair Powell to hold rates steady.
• On 26/08/2025, Intel warned in an SEC filing that the Trump administration’s move to take a 10% stake in the company could spark “adverse reactions” from investors, employees, customers, and foreign governments, especially given that 76% of Intel’s $53.1 billion in 2024 revenue came from overseas. The $11.1 billion deal, funded largely by Biden’s CHIPS Act awards, grants the Commerce Department up to 433.3 million shares, diluting existing shareholders and giving the government voting power alongside Intel’s board. While Trump hailed the agreement as “a great Deal for America” tied to advanced chip production, Intel cautioned that political shifts, litigation, and governance restrictions could pose risks. The filing also noted unresolved financial and accounting implications, adding to uncertainty following CEO Pat Gelsinger’s December exit and Lip-Bu Tan’s March appointment, even as Intel shares gained 25% in August on deal momentum.
• On 27/08/2025, Australia’s consumer prices surged 2.8% in July from a year earlier, well above forecasts, mainly due to a 13% jump in electricity costs as households in NSW and the ACT missed out on federal rebates that month. Core inflation also picked up, with the trimmed mean at 2.7% and underlying inflation at 3.2%. The Reserve Bank of Australia, which recently cut rates for a third time, signaled more easing ahead depending on data trends, though it expects headline inflation to rise to 3.1% next year as rebates fade while core inflation stays near 2.6%. The July CPI also showed rents slowing to 3.9% annual growth, while clothing and footwear rose 1.7% in the month.
• Japanese government bond (JGB) yields are climbing as rising U.S. yields, political uncertainty, and fiscal concerns weigh on investor confidence. Analysts warn that Japan’s heavy exposure to U.S. assets—about $2 trillion—makes its markets highly sensitive to global rate moves, with JGBs closely tracking Treasuries. Confidence has been further shaken by Trump’s bid to influence the Fed and pressure on U.S. debt’s safe-haven status. At home, fears of fiscal loosening, election losses for the ruling coalition, and delays in budget talks add to concerns. Strategists caution that with few buyers for long-term JGBs, yields will likely keep rising in step with U.S. inflation and global rate pressures.
• On 28/08/2025, Nvidia beat Wall Street estimates with Q2 2026 earnings of $1.05 per share on revenue of $46.74 billion, up 56% year-over-year, though data center revenue again fell short of expectations. The company forecast $54 billion in revenue for the current quarter, well above analyst estimates, and said AI infrastructure spending could reach $3–4 trillion by 2030. Net income surged 59% to $26.4 billion, driven largely by its data center business, which grew 56% to $41.1 billion but was impacted by delays in shipping H20 chips to China. Nvidia expects potential H20 sales of $2–5 billion this quarter if licensing issues ease, underscoring both its reliance on AI demand and exposure to geopolitical risks.
• On 29/08/2025, The U.S. economy grew 3.3% in the second quarter, above the initial 3% estimate, rebounding from a 0.5% decline in Q1. The growth comes as President Trump escalates pressure on the Federal Reserve to cut rates, while his 50% tariffs on $80 billion of Indian goods intensify global trade tensions. Analysts warn India will face heavier economic fallout since the U.S. buys 20% of its exports, while U.S. industries fear higher consumer costs. The Fed remains cautious on rate cuts, weighing inflation risks from tariffs, but Trump’s push to replace governors could shift the balance in his favor.
• On 30/08/2025, A federal appeals court ruled 7-4 that most of Trump’s global tariffs, including his “reciprocal” tariffs, are unconstitutional because only Congress has the power to impose them, striking a major blow to his trade policy. The court paused enforcement until Oct. 14 to allow an appeal to the Supreme Court, which Trump vowed would side with him, calling the ruling partisan. The decision, part of the V.O.S. Selections v. Trump case, follows earlier court rejections of Trump’s use of the International Emergency Economic Powers Act (IEEPA) to justify sweeping tariffs. Supporters of the ruling say it protects businesses and reaffirms constitutional limits on presidential power, while the administration warns that overturning the tariffs would harm U.S. interests and foreign negotiations.