Macro This week, the U.S. House of Representatives narrowly passed Trump’s tax and spending proposal, which increases the debt ceiling by USD 4 trillion and is projected to add between USD 3.8 trillion and USD 4.7 trillion to the national debt over the next decade. There is no appetite to touch Medicare and Medicaid, and the most controversial items in the budget remain Trump’s old and new tax cuts. The…

Macro U.S. consumer confidence, based on data collected before the recent US-China trade negotiations, has dropped to the second-lowest level on record. Meanwhile, the University of Michigan’s survey shows the 1-year inflation outlook spiking to 7.3%—a level not seen since the 1980s. However, it’s worth noting that survey-based data has become increasingly volatile and less reliable in the post-pandemic era. Despite elevated yields in the 4–5% range, the U.S. economy…

Macro The FED held rates unchanged, in line with market expectations. What was unexpected was the lack of commitment to future cuts. The FED is ‘not in a hurry’ to cut but has warned about the growing risk of inflation and higher unemployment caused mostly by Trump’s tariffs. The FED failed to affirm any expectations, which means that it doesn’t know what is going to happen and does not attempt…

Equities On Wednesday (30/04), Q1 GDP came in at -0.3% QoQ vs. -0.2% expected, marking the worst reading since Q1 2022 (-1%). The decline was driven by a surge in pent-up imports ahead of Trump’s tariff policy. A rebound is expected in Q2 as imports normalise, but Q3 and Q4 may face distortions. Prediction markets (Polymarket) now assign a 65% recession probability this year. The Fed, however, still projects 1.7%…

Macro In the first 100 days of his second term, Donald Trump’s presidency has had profound and destabilizing effects on the U.S. economy. His aggressive use of tariffs triggered significant market volatility, rattling both equity and bond markets. Investors, typically drawn to U.S. Treasuries during periods of risk, instead shifted assets toward safer foreign currencies like the yen and Swiss franc, signaling a loss of confidence. As a result, the…

Macro It was a relatively light economic calendar this week. U.S. retail sales rose 1.4% in March, the most substantial gain since January 2023, driven largely by a surge in auto purchases likely accelerated by impending tariffs. However, control group sales disappointed, and the boost is seen as temporary. Other data showed mixed signals: housing starts dropped 11.4% to an eight-month low, and industrial production declined 0.3%, weighed down by…