The policy chaos which has become characteristic of the Trump Administration escalated over the past month. The much-anticipated Liberation Day tariff announcement was significantly worse than expected, sparking the fifth largest two-day fall in the US market since 1965 (~-10%). The market then partially recovered on news that reciprocal tariffs on all countries except China would be delayed for 90 days, though this gain hasn’t been maintained. Importantly, while bonds were initially rallying (yields falling) this has subsequently reversed with US bonds now selling off in sync with equity markets. This may reflect investors calling into question the inviolability of US government debt with Trump at the helm. Australian bonds have been better supported, a positive for our portfolios.
The policy chaos which has become characteristic of the Trump Administration escalated over the past month. The much-anticipated Liberation Day tariff announcement was significantly worse than expected, sparking the fifth largest two-day fall in the US market since 1965 (~-10%). The market then partially recovered on news that reciprocal tariffs on all countries except China would be delayed for 90 days, though this gain hasn’t been maintained. Importantly, while bonds were initially rallying (yields falling) this has subsequently reversed with US bonds now selling off in sync with equity markets. This may reflect investors calling into question the inviolability of US government debt with Trump at the helm. Australian bonds have been better supported, a positive for our portfolios.
The policy chaos which has become characteristic of the Trump Administration escalated over the past month. The much-anticipated Liberation Day tariff announcement was significantly worse than expected, sparking the fifth largest two-day fall in the US market since 1965 (~-10%). The market then partially recovered on news that reciprocal tariffs on all countries except China would be delayed for 90 days, though this gain hasn’t been maintained. Importantly, while bonds were initially rallying (yields falling) this has subsequently reversed with US bonds now selling off in sync with equity markets. This may reflect investors calling into question the inviolability of US government debt with Trump at the helm. Australian bonds have been better supported, a positive for our portfolios.
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