News & Reports Archives

Tariffs Cause Global Market Chaos

Written by IntaCapital Swiss on April 9, 2025. Posted in News & Reports. Leave a Comment

On Monday, 7th April 2025, and from the opening bell in the far east, through Europe, and into the United States, chaos ensued across global markets. In the Asia Pacific arena, long before Europe and the United Kingdom had woken up, stock markets fell on a scale not seen in decades. In some Asian exchanges, due to mounting losses, trading was suspended as the Shanghai composite sank 7.34% and Japan’s Nikkei fell 7.83%. Hong Kong was the worst hit while equities in Japan, Taiwan, Australia, South Korea, and Singapore all suffered heavily, seeing steep declines.

In Hong Kong, the stock market plummeted 13.74% (its biggest single day decline in 30 years), before closing out at 13.22%. Experts suggest that the fall in Hong Kong’s stock market accurately reflects market expectations on how tariffs will affect the Chinese economy rather than any movement on China’s stock exchanges. They point out that Chinese stocks cannot be shorted, and it is impossible to trade freely.

In Europe, markets were also having a bad day as Donald Trump continued to wage his trade war. The pan-European STOXX 600* took a beating and was down 4.5% (down for the fourth straight session), whilst other major stock exchanges or bourses closed out down between 4% and 5%. In Germany, the benchmark DAX index** (.GDAXI) (trade sensitive) fell by as much as 6.4% finally closing at down 4.3% but painfully down 20% from its March 2025 closing all time high.

*STOXX 600 Index – This index tracks 600 of the largest stock exchange listed companies from 17 countries in Europe. The countries represented are Austria, Belgium, Denmark, Finland, France, Germany, Ireland, Italy, Luxembourg, the Netherlands, Norway, Poland, Portugal, Spain, Sweden, Switzerland, and the United Kingdom.

**DAX Index – This index measures the performance of Germany’s 40 largest companies that trade on the Frankfurt Stock Exchange and is considered by many analysts as a gauge of Germany’s economic health.

Again on Monday, 5th April, along with other global stock markets, UK stocks fell dramatically extending their selloff from the previous week. The FTSE 100 closed down 4.4%, hitting its weakest closing level for over 12 months and since Thursday, 3rd April, Blue Chips have fallen by 10%. In the meantime, Prime Minister, Keir Starmer, has announced that the United Kingdom will seek to lower trade barriers with key trading partners around the world whilst fighting to secure a trade partnership with the United States.

In the United States, the news was just as bad with the Dow Jones Industrial Average falling for a third day on the trot, with the S&P 500 losing in excess of 10% since Thursday, 3rd April. Equity markets are sending a massive NO to President Trump’s Liberation Day tariffs and analysts suggest that hedge funds may well be forced to sell down their equities and other current risky assets in order to pay margin cash calls.

There seems to be no let up on tariffs as President Trump doubles down on China and announces that there are no plans to pause tariffs. Indeed, China imposed a 34% tariff on all U.S. goods on Friday, 4th April 2025, in response to the 34% tariff imposed by President Trump on all Chinese goods. However, in response to the Chinese actions, Trump announced he would retaliate with a further 50% tariff on all Chinese goods into the U.S. effective 9th April, unless China withdraws their tariff by 8th April. China is in no mood to take a backward step with Beijing vowing to fight to the end and China’s Commerce Ministry accused the U.S. of blackmail.

President Trump and his Trumpeteers have said that tariffs have stopped bleeding the U.S. of income and in four years we will be rich and self-sufficient whilst opponents cry you have wrecked global stock markets, sabotaged supply chains and ruined individuals’ pensions. The looming trade war with China will have, according to experts, massive fallouts across the globe. Who will blink first, China or America or will the world see a massive realignment of global trading?

Tariffs, Tariffs and More Tariffs as Donald Trump Risks Global Trade War

Written by IntaCapital Swiss on April 9, 2025. Posted in News & Reports. Leave a Comment

Wednesday, 2nd April 2025 (or liberation day as per President Trump), is a day that will stand out in history, as Donald Trump announced a sweeping across the board 10% tariff on all imports of goods into the United States. He further announced reciprocal tariffs of 20% and rising on countries he feels has cheated America, by which he means those countries with massive trade surpluses with the U.S. and also those who already add big tariffs to American imports. President Trump had already separately announced a tariff of 25% on all global car, truck and auto accessories starting on 3rd May 2025, and a 25% tariff on all aluminium and steel products. Experts advise that these levies/tariffs/taxes are the biggest increases since 1968.

Global markets from tech to banking have been left reeling as President Trump through his tariffs attempts to rearrange global trading and the current economic order. However, thanks to tariffs, U.S. equities have taken a beating with the three major stock indexes plunging in excess of 5%, the biggest of which was the S&P 500, which crashed by almost 6%. This was the steepest fall since 2020, and elsewhere in the United Kingdom the FTSE 100 fell by just under 5%, marking its steepest fall since 2020, with similar falls being recorded in France and Germany. The global stock market has, since Trump announced an across the board tariff of 10% on every country, lost literally trillions of dollars in value, however China, the EU (European Union) and Vietnam are all facing higher tariffs on their exports to the U.S..

On Friday, 4th April 2025, China announced a 34% tariff on products from the U.S. whilst at the same time lowering exports of essential minerals plus adding a number of American companies to their blacklist and accusing Donald Trump of violating international trade rules. The EU announced through their trade commissioner that they are still looking for meaningful discussions in the hope of reducing their across the board 20% tariff, though he promised if talks failed the EU would defend themselves. The largest EU economy is Germany and with a separate tariff of 25% on the imports of cars into the U.S. and a 20% across the board tariff on all imports into the U.S., the German economy will, according to experts, take a hit in a drop in GDP of 1.5% equivalent to a loss of Euros 200 Billion over the tenure of President Trump.

The President of the EU, Ursula von der Leyen, has vowed to retaliate and condemned President Trump and went on to say that tariffs will have dire consequences for all consumer and businesses on a global basis that have enjoyed trading with the U.S. since World War II and added, “We are already finalising a first package of countermeasures in response to tariffs on steel”. The EU is of course still open to negotiations, but Ursula von der Leyen is in no mood to lie down and be trodden on. She has already announced that the EU has everything it needs to survive and survive it will. Tough talk from a tough President who will meet Donald Trump head on, so unless negotiations are successful, a full-out trade war between the U.S. is certainly on the cards and could go global.

In the United States, many experts and analysts agree that the new tariffs will push the American economy into recession, an economy which is currently losing momentum, with the result of increasing prices due to tariffs being passed on to the consumer. Analysts further advised that the tariffs could well push the American economy into a recession and have a negative effect on inflation, reversing the current downward trend. Indeed, the US Dollar shortly after the tariff announcements fell by 1.7% against a basket of European trading partners’ currencies which according to market experts reflect concern regarding growth in the economy. Some experts have warned that core inflation (excludes food and energy prices) could go as high as 4% (3.1% as of end of February 2025), unemployment to rise (despite current hiring figures showing an increase) and real GDP to decline.

In the long run, experts suggest that Trump may get his financial rewards from tariffs but his “allies” who he has hit with punitive tariffs may well look elsewhere for new trading partners, with China being the ultimate beneficiary which may well benefit BRICS* as well. Indeed, BRICS is now a major political force looking to be a counterweight to western influence with its current members accounting for just over 25% of the global economy and almost half the world’s population. There has been a lot of internal division within the BRICS organisation, with Russia leading the way over their unlawful invasion of Ukraine, however tariffs may bring them together in such a way that the allies who Trump has hit with punitive tariffs may well look to increase trade with these countries. Whilst the America First slogan is banged consistently by the U.S. administration, some of the poorest nations in Africa have been hit with punitive tariffs, with Lesotho being a prime example at a massive 50% tariff. It is no secret that BRICS want what they call the southern nations to come under their umbrella (Africa and South America) and again these tariffs could drive these nations into the arms of BRICS. Geopolitically, tariffs may be the current U.S. administration’s biggest mistake.

*BRICS – is an intergovernmental organisation consisting of ten countries, Brazil, Russia, India, China, South Africa, Egypt, Ethiopia, Indonesia, Iran, and the United Arab Emirates. The founding countries were Brazil, Russia, Indonesia, and China forming BRIC with South Africa joining at a later date to form BRICS. There are a slew of countries waiting approval of membership from BRICS including Saudi Arabia who have been approved but have delayed joining.

In the United Kingdom, experts advise tariffs will hit key manufacturing sectors and will undermine the positive growth, albeit fragile, predictions of the Labour government. Many businesses are already facing rising costs due to the Chancellors’ budget and tariffs will, according to some analysts, place negative pressure on demand and weaken supply chains. The Director of the British Chamber of Commerce was heard to say that “Orders will drop, prices will rise, and global economic demand will be weaker as a result”. Prime Minister, Keir Starmer, advised he is still hopeful that negotiations will reduce the 10% tariff, however he has begun the process of consultation with regard to retaliatory tariffs should negotiations fail. Across the Irish Sea, Northern Ireland ministers announced they feel trapped as despite the 10% tariff on the United Kingdom, if the EU announces retaliatory tariffs N. Ireland could face the higher EU tariff on any U.S. imports entering from Britain under the post-Brexit deal* between the United Kingdom and the EU.

*The Northern Ireland Protocol – is intended to protect the EU single market while avoiding the imposition of a “Harder Border” that might incite the recurrence of conflict and destabilise the relative peace that has held since the end of the troubles.

In Asia, the APAC* region was hit with tariffs between 10% and 49% with the higher rates being targeted at those countries’ lower value-added items such as textiles, garments, furniture, and footwear. Vietnam (apart from China) is currently enjoying the largest trade deficit with the U.S. (USD 123.5 Billion), got hit with 46% tariff, whilst Cambodia got hit with a 49% tariff (trade deficit USD 12.13 Billion) Sri Lanka saw a 44% tariff (trade deficit USD 2.65 Billion), Bangladesh was given a 37% tariff (trade deficit USD 2.6 Billion) with larger economies in the region slightly better off with Singapore being hit with the minimum of 10% tariffs. Experts suggest that Asian currencies may face depreciation pressure as financial markets could turn risk averse affecting FII (Foreign Institutional Investor) inflow.

*APAC – stands for Asia Pacific Region and is a broad geographical region encompassing countries and territories in or near the Western Pacific Ocean. This region typically includes East Asia, South Asia, South East Asia, and Oceania (Australia, New Zealand, and surrounding islands).

In typical Trump fashion, in one fell swoop global trading has been turned on its head, geopolitics may never be the same again and markets will remain volatile for some time to come. Experts suggest it may take weeks or in some cases months to assess the fall-out from President Trump’s tariffs. President Trump may well have destroyed smaller more vulnerable economies, destroying the lives of that country’s population at the same time. However, in breaking news the White House advises that 50 countries have contacted the administration looking to do trade deals and avoid duties. Meanwhile voices in the U.S. from the CEO down to the smallest consumer are already getting louder voicing their antipathy towards tariffs with anti-tariff rallies taking place in a number of cities throughout the world. He may think he is putting “America First” but who’s to say in the long run it may well be “America Second”.

Donald Trump is Ruining European Wineries

Written by IntaCapital Swiss on April 2, 2025. Posted in News & Reports. Leave a Comment

Wine growers across the European continent have been struggling due to a decline in consumption from secular demand with consequences so awful that the French government has been paying growers to uproot their vines. Then along comes President Trump with his oft-repeated rhetoric “America First”, threatening tariffs of 200% on European wine, with the result that shipments of the product have completely stopped and owners of vineyards no longer know how to price their bottles.

European wineries are at a loss of exactly what to do, especially now as overseas clients orders are rapidly disappearing, with the result that many brands such as Chardonnay and Merlot will be cellar bound rather than sold. Indeed, in France’s biggest wine cooperative located in Cave Héraclès, there are in excess of 200 steel tanks which by experts’ calculations are as high as a six-storey building and are still full of 2024’s production. The region, as with the rest of Europe, can see the vines budding again, and the next harvest is not that far away.

Owners of these vats are being told to wait by buyers who already have enough wine on their books, and somehow the vats need to be empty by July at the very latest in order to accommodate this year’s produce. Now that President Trump has announced his punitive tariff, he has brought the whole industry to a complete stop. Producers of wine now are unable to commit to a price as they don’t know for sure exactly what the tariff will be. They therefore are unable to commit or offer any discounts as they have no idea what their ultimate costs will be. Furthermore, they could well incur extra costs to empty their vats to store elsewhere to accommodate the new produce.

Sadly for wine producers, there is currently a global glut of product and 2024 saw a slump in production mirroring a 60-year low. Demand for wine is falling at an accelerated rate, with today’s health conscious youngsters drinking less than baby boomers or millennials when they were the same age. A number of savvy brand owners fearing a Trump victory, shipped excess supplies to the United States before Trump won the election. Indeed, Sogrape owner of Mateus Rosé ensured their importer in America has at least six months’ supply, whilst the wine estate Château de Fieuzal also shipped many more bottles than previously planned to the United States.

The wine tariff on European Wines and champagne was announced by Trump as a retaliatory measure against the EU (European Union) for threatening tariffs on American whisky due to come into effect on 14th April 2025. In 2024, the United States accounted for 30% of all of Europe’s wine exports, and the European Commission (handles all trade matters for the EU) is currently working on a concession package to present to the Trump administration in the hope that partial tariffs can be removed. However, with the mood Donald Trump is in, the European wine growers can only hold out hope that the commission is successful.

Donald Trump Hits European and UK Carmakers with 25% Tariffs

Written by IntaCapital Swiss on April 2, 2025. Posted in News & Reports. Leave a Comment

On the evening of Wednesday, March 26th 2025 in Washington DC, and in a devastating blow to global car makers, President Donald Trump announced a 25% tariff on all car imports into the United States which translates into levies amounting to circa USD 100 Billion. The President was quoted as saying, “This is the beginning of liberation day in America, this is very modest. What we’re going to be doing is a 25% tariff on all cars not made in the United States”. He went on to say, “We’re going to charge countries for doing business in our country and taking our jobs, taking our wealth, taking a lot of things that they’ve been taking over the years”.

This move of course exacerbates the global trade war started by President Trump, taking the animosity towards him from his allies to new heights. The Shadow Trade Secretary to the House of Commons in the United Kingdom noted that he is concerned with this auto tariff, adding that the UK automotive sector is under pressure and British jobs are clearly at risk. The president of the EU (European Union), Ursula von der Leyen, said, “I deeply regret the US decision to impose tariffs on EU automotive exports”. The German Economy Minister Robert Habeck has called for the EU to provide a decisive response.

Experts in this arena suggest that due to the imposition of a 25% car tariff, the price of cars could rise between USD 5,000 and USD 15,000 depending on the vehicle, and even those automobiles assembled in the United States could rise between USD 3,000–USD 8,000. The rise in US assembled automobiles, according to analysts, is that roughly 50% of parts in US-produced cars are imported and tariffs on auto parts will significantly increase production costs. The United States imported circa 8 million cars in 2024 with a trade value of over USD 240 Billion, the country’s total automotive vehicle imports including engine and parts was over USD 474 Billion.

Certain media outlets in the United Kingdom are saying that the government in private is advising car manufacturers that they are confident of securing a bi-lateral trade deal with the U.S. administration and will hope to avoid President Trump’s car tariffs on the importation of vehicles into the United States. The Chancellor of the Exchequer, Rachel Reeves, has been quoted as saying “the Government is in intense negotiations with the U.S.”. Data released by the Society of Motor Manufacturing and Traders confirm that Europe is the biggest export market for UK made motor vehicles, with the United States firmly in second place enjoying circa 16.9% of UK car exports. Analysts suggest Jaguar Land Rover may be one of the hardest hit by tariffs, and Aston Martin saw its share price fall by 6% on the London Stock Exchange in response to Trump’s announcement.

In Europe, there is outrage over the car tariffs with the VDA (German Association of Automotive Industry) warning of a serious economic fallout. The association further added that the consequence of tariffs will cost prosperity and growth on both sides of the Atlantic. President of the VDA, Hildegard Müller, highlighted the fact that German firms employ circa 138,000 workers in the U.S.A., split 48,000 in manufacturing and 38,000 in parts supply. Various automotive bodies have urged officials in the European Union to get back round the table, with the Trump administration and thrash out a trade deal instead of talking about reciprocal tariffs.

Officials of the European Union who last week met with their U.S. counterparts see little chance of averting this current round of tariffs. There have been muted signs of the EU and Canada working together against the U.S., but President Trump threatened larger tariffs if the two countries joined forces. EU officials suggest that Trump will issue an EU bloc-wide tariff rather than a country by country tariff. Analysts advise that Volvo cars and Porsche stand to be the two hardest hit manufacturers should tariffs proceed on the 2nd of April 2025, whilst Thursday 27th March saw shares in Porsche plunge 5.4%, Mercedes-Benz AG fall 4,8%, Ferrari and BMW AG fell 4.7% and 3.7% respectively and Volkswagen AG fell circa 2%.

Amongst all the outrage and wringing of hands regarding this car tariff, President Donald Trump has gone on record as saying, “I couldn’t care less if automakers raise their prices” in a response to planned tariffs on imported vehicles. He went on to say, “I couldn’t care less if they raise prices, because if they do, people are going to buy American-made cars”. The new automobile tariffs come into effect on 2nd April 2025, whilst tariffs on parts are set to start in May 2025 or later.

New Lenders in the Crypto World for those Crypto Companies Seeking Debt

Written by IntaCapital Swiss on March 26, 2025. Posted in News & Reports. Leave a Comment

The crypto lending arena was nearly wiped out during the last major bear market, but is staging a huge comeback, and Cantor Fitzgerald (Cantors)* is trying to satisfy the crypto industry’s hunger for debt. Such lenders range from crypto native firms* to traditional banks and have been putting in place, or are putting in place, the means of providing capital to a whole smorgasbord of crypto market activities.

*Cantor Fitzgerald – is an American financial services firm that was founded in 1945. It specialises in institutional equity, fixed-income sales, trading, and serving the middle market with investment banking services, prime brokerage, and commercial real-estate financing. On March 11th 2025, Cantors announced that Anchorage Digital and Copper.co (“Copper”) will serve as collateral managers and custodians for the firm’s Global Bitcoin Financing.

**Crypto Native Firms – founded with the sole purpose of investing in digital assets and providing investment products in a market previously underserved by traditional asset managers. Native crypto managers have, of course, experience with digital assets and operational nuances.

After the debacle of 2002 and 2003, quite a number of crypto lending companies went bankrupt due to some very dodgy loans, and whilst crypto lending had its heyday in 2021, volume today is still well-short of that mark. Through Q1, Q2, and Q3 of 2024 Bitcoin lending went up by circa 300%, and with speculation in Bitcoin that propelled it above USD 100,000, fervour is spilling over and continuing to fortify the crypto lending sector, and leading the way are the decentralised finance applications.

In March 2025, Cantors started its global Bitcoin financing with an initial capital of US Dollars 2 Million. Elsewhere crypto wealth manager Xapo Bank began offering loans of up to USD 1 Million backed by Bitcoin, and securing a multi-billion US Dollar investment in its crypto lending funds is Blockstream Corp. the Bitcoin software firm. Loans against Bitcoin have been increasing by the month, with investors in the coin looking to utilise this asset as collateral for other investments.

The crypto market has always been heavily reliant on lenders who have provided critical liquidity to trading and other areas over the years, especially in times of volatility. However, the more traditional banks have avoided this market and, due to the uncertainties that surround the regulatory arena, have not lent to market participants. This decision led to the explosion of crypto lenders during the bull market in 2021. Analysts and some industry participants say, since the election of Donald Trump, crypto lending is poised to grow exponentially due to support of regulations that are favourable to the sector.

Indeed, the sector is now seeing increased interest from traditional lenders as they are becoming more comfortable with the current Trump administration and their favourable leanings toward crypto regulation and legislation. Experts suggest that this will lead to loans backed by Bitcoin that will be supported by more sophisticated risk-management and larger balance sheets at the more traditional lending institutions. However, analysts suggest that

crypto lending has returned with a more conservative approach with LTV ratios (Loan To Value) being lower, which translates into lenders reducing their risks requesting borrowers to make larger down payments. Experts advise that crypto natives can reinvent a couple of centuries of lending risks, and if crypto lending is to properly take off, the arena will need experts from outside the crypto industry.

Trump Takes Aim at Chinese Ships with Docking Levies at U.S. Ports

Written by IntaCapital Swiss on March 26, 2025. Posted in News & Reports. Leave a Comment

The new U.S. administration has suggested imposing multi-million U.S. Dollar levies on Chinese ships wishing to dock in ports in the United States. Experts in this arena say that this will disrupt global trade and suggest the fall-out could be more disruptive to global trade than tariffs. An immediate example of this fall-out can be located in Germany where port workers should be loading a first round 16,000 MT of steel piping, bound for a huge Louisiana energy project. However due to the proposed levies, the cargo is now sitting gathering dust in a German warehouse.

This is a nightmare scenario for exporters, importers, and ship owners alike – especially as on this particular Atlantic shipping route, 80% of these ships were all built in China. The owners of the ships are not necessarily Chinese, it is just the ships that were built in China, which are being targeted. In this instance, the shipment of 16,000 MT of steel pipes are looking at a potential levy/surcharge of USD 1–3 Million which means the overall transportation cost could increase by 200%–300%.

Current data from the USTR (Office of the US Trade Representative), reveals that China now produces in excess of 50% of the world’s cargo ships by tonnage, (5% in 1999), with Korea and Japan accounting for most of the remaining cargo ship building. In 2024, shipyards in this arena accounted for 0.01% of cargo ships built, thus experts have surmised that this levy madness on Chinese-built ships can only help the long-held aim of the USTR in reviving the US merchant shipbuilding industry, a sleeping giant if there ever was one.

On Monday, 24th March 2025, a hearing begins in Washington D.C. into the ramifications of this trade levy, with representatives from industries from all corners of the world. They will explain to the hearing that these proposals are more damaging than Trump tariffs because of the severe threat to supply chains and, as a result, would severely disrupt global trade, dwarfing the results of any trade tariffs. Furthermore, some carriers have announced that not only will the increase in costs be passed on, but will pull out of docking at smaller ports which, of course, will suffer from the downturn in business.

Analysts suggest that, in theory, these levies could generate between USD 40–52 Billion for the United States. However many U.S. companies are worried as there are escalating tariffs on Chinese goods, aluminium, and steel, plus there are reciprocal tariffs due on 2nd April 2025. However, analysts point to the obvious downside, where U.S. businesses (especially the farming industry) and ultimately the U.S. consumer will come under pressure, raising prices throughout the United States, and threatening jobs across the board.

However, the revival of the U.S. shipping industry is definitely in the sights of President Donald Trump and has now been cast as part of National Security as per the issue of the draft document “Make Shipbuilding Great Again”. Once again, it is felt that President Trump will put pressure on allies to do the same or they will face penalties as well. It is feared the allies are currently not happy being treated like second-rate citizens, so this outcome will be interesting to see. Everyone involved in the United States appears to agree that U.S. shipbuilders cannot compete on an even playing field due to unfair production and market practices by the Chinese.

However some major U.S. carriers have advised if the full implementation of this draft document is achieved, it could put them out of business. There is hope that some of the proposals will be watered down, but if not one veteran in the maritime transportation industry advised that these proposals will be like an “Apocalypse for the trade”. Furthermore, due to lack of domestic production, the “Louisiana Energy Gateway” project (slated to deliver the next generation of LNG – Liquid Natural Gas a Trump favourite), still needs 16,000 MT of steel piping.

Swiss National Bank Cuts their Benchmark Interest Rate

Written by IntaCapital Swiss on March 21, 2025. Posted in News & Reports. Leave a Comment

On Thursday, 20th March 2025, officials of the SNB (Swiss National Bank) cut their benchmark interest rate by 25 basis points to 0.25%, the lowest rate since September 2022. In the current cycle of quantitative easing, this is the fifth time the SNB has cut rates and President Martin Schlegel signalled that officials do not expect any more easing for the time being. The President went on to say that “This rate has an expansionary impact; in that sense the probability of additional policy easing is naturally lower”. Experts advise that pricing in the swaps market indicates no more rate cuts by the SNB in 2025.

The move to cut rates on Thursday follows a reduction in rates by 50 basis points in December 2024, a move that caught financial markets by surprise. Analysts suggest that this move completes their foreign-exchange policy which i.) is in anticipation of future market volatility and ii.) to deter inflows into the Swiss Franc. As a result of global trade tensions due to President Trump’s tariffs and other geopolitical and economic policies, the Swiss Franc is regarded as a safe haven for investors guarding against global instability.

Data released during the week prior to Thursday’s rate cut shows that in the last quarter of 2024, the SNB basically removed themselves from the foreign exchange markets, confirming one whole year without any considerable interventions. Indeed, once Trump won the presidential election on 5th November 2024, the Swiss Franc gained against the Euro, but those gains have since been erased with the Franc weakening against the Euro. The President of SNB said on Thursday, “Switzerland is not a currency manipulator; past interventions were necessary to maintain price stability”. This statement analysts suggest is to remind Trump that during his first term, Switzerland was branded a currency manipulator.

Experts in this arena suggest that the decision to cut interest rates is to contain market pressure, and to stop the Swiss Franc from strengthening thus lowering import costs which would impact negatively on inflation. SNB President Schlegel said, “the outlook for inflation is currently very uncertain, with risks predominantly on the downside” SNB officials have lifted their inflation forecast from 0.30% to 0.40% for 2025 and 0.80% in 2026 and 2027. SNB also confirmed that during the last quarter, Switzerland’s economy enjoyed its strongest expansion and, as a result, still expects the economy to grow between 1.005 to 1.50 % in 2025. Once again Donald Trump’s tariffs and other policies both domestic and international seem to heavily weigh on policymakers’ decisions at central banks.

Bank of England Holds Interest Rates Steady

Written by IntaCapital Swiss on March 21, 2025. Posted in News & Reports. Leave a Comment

On Thursday, 20th March 2025 the BOE (Bank of England) held interest rates steady at 4.50%. Officials from Threadneedle Street warned that the bank was grappling with major uncertainties over the British and world economies and warned financial markets not to assume there would be interest rate cuts over the next few meetings. The MPC (Monetary Policy Committee) voted 8–1 to leave interest rates unchanged apart from Swati Dhingra (external member) who voted for a 25 basis point cut.

The vote of 8–1 by the MPC indicates a more hawkish stance, with both experts and analysts expecting a 7–2 vote, though most agreed that holding interest rates this time round was a shoe-in. Indeed, in the run-up to Thursday’s rate decision, some of the most dovish members of the MPC had already adopted a more cautious tone regarding interest rates.

A number of experts agreed that Thursday’s decision to keep interest rates on hold was strengthened by the banks’ increased uncertainty over domestic issues, plus April’s increases in energy and labour costs. In the bond markets, 10-year gilts rose as traders pulled back on bets on future rate cuts whilst the pound remained weaker against the US Dollar at circa $1.297.

The Bank of England is the latest central bank to adopt a more hawkish and wary tone in the face of President Donald Trump’s tariffs attacks on the United States’ closest allies. Indeed, the Governor of the Bank of England said, “Officials are having to react to fast-moving global events, with effects on inflation and growth far from certain”. He went on to say, “We have to be quite careful how we calibrate our response because we are still seeing a very gradual fall in inflation”. He also added that BOE officials were still waiting to see what the effects are of any tit-for-tat skirmishes on the tariff front.

The aura of uncertainty pervading from Threadneedle Street suggests that interest rates will remain static for the next two meetings, especially as experts suggest pay growth will be a key ingredient to future rate decisions by the MPC. Data produced on Thursday morning showed wage growth holding at a nine month high accompanied by a resilient labour market. However, minutes released by the MPC showed members as being not too worried about the strong pay data, though the minutes added that members would keep a close eye on wage settlements. However, whatever financial, employment, wages and inflation data is forthcoming, the spectre of Donald Trump’s tariffs and economic policies will loom large over many central banks’ policy decisions.

Federal Reserve Holds Interest Rates Steady

Written by IntaCapital Swiss on March 20, 2025. Posted in News & Reports. Leave a Comment

On Wednesday, 19th March 2025, the Federal Reserve announced they were holding their benchmark interest rates steady at 4.25% – 4.50%. The FOMC (Federal Open Market Committee) voted 8 – 1 in favour of keeping interest rates steady, with the dissenting voice belonging to Christopher J. Waller, who has been a member of the Board of Governors since December 18, 2020. It appears that members are concerned that inflation could remain stubbornly high whilst at the same time the economy could be slowing.

The Chairman of the Federal Reserve, Jerome Powell, confirmed that the significant policy changes attributed to President Trump were the main reason for the Fed’s high degree of uncertainty in regard to the U.S. economy. However, he went on to say that Federal Reserve officials will certainly wait for greater clarity on the impact of President Trump’s policies, before making any definite changes to borrowing costs.

Policymakers still suggest that further interest rate cuts will be necessary, with financial markets pricing in two further cuts, totalling 50 basis points in 2025 and a number of traders suggesting that there is a 62.1% of a further interest rate cut in June this year. Officials further marked down their outlook for inflation and growth and see the economy accelerating by just 1.7% this year, down from 2.1% as advised by their last projection in December 2024.

On the inflation front, Fed policymakers advise that inflation has remained elevated since Donald Trump was elevated to the Presidency and have raised their average estimate for core inflation (does not include food and energy prices) for 2.5% to 2.8% for year end 2025.

They also increased their estimate for the end of 2025 from 4.3% to 4.4%, whilst confirming that consumer confidence had gone south, resulting in softening spending figures.

It is expected that the Federal Reserve’s interest rate decision will incur the wrath of President Trump, who has repeatedly suggested that he should have a role in interest rate decisions. Indeed, he announced to the world in January 2025, at the World Economic Forum in Davos, “With oil prices going down, I’ll demand interest rates drop immediately, and likewise they should be dropping all over the world”.

Experts suggest that in the coming months, President Trump will certainly try and get a firm grip on the Federal Reserve as he will wish to exert his influence on interest rate decisions. Indeed since the inauguration of President Trump on January 20th 2025, the Federal Reserve has held two meetings where the decision was to hold interest rates steady, with the first meeting in January bringing an end to a run of three consecutive interest rate cuts.

In the run up to the presidential election on November 5th 2024, Trump announced he would not fire Jerome Powell, but with two interest rate holds two months into the Presidency we will have to wait and see. However, a President only has the power to appoint a Fed chairman, he cannot fire the chairman unless he has “cause” as per the Federal Reserve Act. In other words, President Trump cannot fire Chairman Powell over policy disagreements, but Trump being Trump he may find a way to get what he wants.

Donald Trump, Tariffs, Gold, U.S. and European Stock Markets, Climate Change and Greenland

Written by IntaCapital Swiss on March 18, 2025. Posted in News & Reports. Leave a Comment

Tariffs

Since Donald Trump officially took office on 20th January 2025, the 47th President of the United States of America has imposed across the board tariffs of 25% on all imports from his two closest trading partners, Canada and Mexico, and increased tariffs on all of China’s exports to the United States to 20%. On 10th February, President Trump also announced a global tariff of 25% on all imports of steel, aluminium and their derivative products, eliciting a response from the President of the European Union who said, “Such tariffs are bad for business, worse for consumers, and would trigger a firm and proportionate European response”.

However, President Trump has since signed an executive order temporarily exempting a significant number of items from tariffs in regard to Mexico. As far as Canada is concerned, Trump threatened a 50% tariff on all aluminium and steel export products to the United States, but backed down when Canada withdrew counter-tariff measures on US-bound electricity and the two parties are now planning new trade talks. In response to US tariffs, China has imposed tariffs of 15% on the importation of US goods such as pork and chicken which began March 10th 2025.

The Europeans have responded to US metal tariffs of 25% with two stage tariffs of their own on US goods totalling circa USD 28 Billion. First, Brussels announced it would from 1st April 2025 reimpose tariffs on such iconic US products such as jeans, Harley-Davidson motorcycles and bourbon, (50% tariff) and second, from mid-April, and subject to agreement from all EU member states, will implement further tariffs of circa USD 18 Billion on other imports from the United States.

The 27 nation members of the EU are determined to send a message to Donald Trump that the European Union is serious about defending their economic interests. The EU has left the door open to Trump saying, “they remain ready to work with the U.S. administration to find a negotiated solution and measures can be reversed at any time should such a solution be found”. The rumour mill suggests that President Trump went ballistic when he was informed of the counter-tariffs by the European Union and said further retaliatory measures on European imports to the U.S. will be imposed for their “nasty” 50% levy on bourbon.

Indeed, President Trump, true to his word, has announced a threatened tariff of 200% (yes 200%) on all wine and champagne imports from member countries of the European Union. The French Foreign Trade Minister said, “We will not give into threats, Donald Trump is escalating a trade war which he chose to unleash”. The pan European/United States transatlantic trade relationship is worth circa USD 1.7 Trillion, but President Trump is still repeating his election-winning rhetoric that there is persistent U.S. trade deficits in goods and tariffs is a way to force businesses to bring industrial investments and jobs back to the United States.

Gold

On 14th March 2025, gold hit an all-time record high of USD 3,004.86 per troy ounce, with commentators and experts suggesting that the above trade wars initiated by Donald Trump has prompted investors to flee into safe haven products such as gold. Indeed, the fear over global growth due to tariffs is such that bullion has been among the best performing assets, rising by 14% from the day Donald was inaugurated on 20th January 2025 and has risen tenfold since 2000, outperforming many big stock indices.

Some experts suggest that there are two drivers pushing gold to these new heights. First, uncertainty pervades the financial markets and appears to be rising thanks mainly to President Trump’s social media comments and his on-going threats and realities of tariffs, plus geopolitical problems in the Middle East and the Ukraine/Russia war. Second, central banks have been buying up gold, perhaps as some analysts suggest they are moving reserves away from the US Dollar. Both of these dynamics have helped drive gold up to its recent record peak with experts saying that they do not see them diminishing in the near future.

A third driver has been the potential for President Trump to slap tariffs on gold imports, which since December has upended the market with massive demand for 1kg gold bars in New York. There is a quirk in the gold market where in London most of the gold trading is in 400 troy ounce bars roughly the size of a brick and weighing about 12.5kg, however in New York the Comex Exchange uses 1kg bars roughly the size of a smartphone.

The possibility of potential levies on gold by Donald Trump has seen more than USD 61 Billion pour into the U.S. market via New York as traders and investors have attempted to avoid tariffs. On a standard trading day gold rarely leaves the vault, but such was the rush to get physical across the ocean the result was a shortage in London, considered the largest gold trading centre in the world. This put smelters in Switzerland under pressure as they had to melt down London’s bricks and transform them into New York’s smartphones before transporting them across the Atlantic.

U.S. and European Stock Markets

Prior to Donal Trump being elected on 5th November 2024, experts confirmed that there was a general consensus among financial analysts and economists that a Trump win would push the dollar higher and be good news for U.S. stock markets. However, such thoughts were built on sand as since Donald Trump’s elevation to the White House on inauguration day on 20th January 2025, stocks in the United States have tanked and the U.S. Dollar has taken a beating moving south against most major currencies.

As mentioned above, there are major uncertainties in the financial markets and companies are still waiting to see what economic damage may be done to the U.S. economy when trading partners throughout the world impose reciprocal tariffs. Trump trade policy, which is generally viewed by the world at large as a rollercoaster and together with the many executive orders has placed downward pressure on business with indicators showing sagging confidence in the consumer sector.

Indeed, analysts advise that under the Trump administration, markets are struggling. Since the inauguration in January 2025, the S&P 500 is down 7.1% and overall the index is down 9.3% lower than the high achieved on 19th February 2025. The Dow Jones index is also down 9% from its December peak. The new administration has spooked investors and as of March 10th 2025, USD 4 Trillion has been wiped out from the S&P 500. Delta Airlines recently announced they were slashing first quarter profit estimates by 50%, citing heightened U.S. economic uncertainty.

Elsewhere and whilst President Trump’s economic policies are sending tremors through Wall Street, such policies are having the opposite effect across the Atlantic ocean. One of Trump’s top foreign policy goals has been achieved, being the increase in defence expenditure by the European Union. Key leaders in Europe have reaffirmed military support for the Ukraine and as such have driven up shares in international military firms giving an upward jolt to stock markets in some of the very countries President Trump has attacked with his trade war.

Indeed, analysts advise that stocks in Europe are seeing their strongest start to 2025, a start not seen since 1990, with the STOXX Europe 600 Index* up 7.7%, the DAX Index** is up 15%, the CAC 40*** is up 9% and in London the FTSE is up 5.6%. The European Commission, which is the executive branch of the EU (European Union), recently announced loans to its 27 members of Euros 150 Billion, plus will loosen fiscal rules for military spending for an additional Euros 650 Billion.

*STOXX Europe 600 – This index is a broad measure of the European Equity Market, consisting of 600 components. It provides extensive and diversified coverage across 17 countries and 11 industries within Europe’s developed economies, representing 90% of the underlying investable market.

***CAC 40 – This index is the benchmark equity index for public companies traded on the Euronext Paris (the Paris Stock Exchange) and is made up of the largest 40 companies listed in France screened by market capitalisation, trading activity, size of balance sheet and liquidity.

Climate Change

It appears that President Trump has little time if any for climate change as he threatens to rip up the rule book regarding greenhouse gases, and amazingly his administration is looking to reconsider official findings that such gases are harmful to the public. On 12th March 2025, President Trump’s EPA (Environmental Protection Agency) issued 31 announcements with their sights firmly directed towards any rule designed to protect water, clean air, and liveable climatic conditions. Indeed, the EPA has instructed that USD 20 Billion in grants to help the climate crisis be withheld citing potential fraud, a move which democrats feel may well be illegal.

President Trump is well known for calling the climate crisis “a hoax” and is determined to repeal any and all laws regarding climate protection and the ultimate health of all Americans, including those who voted for him in the recent elections. There is a massive body of evidence that rising emissions of greenhouse gases cause devastation and economic costs in the trillion of U.S. Dollars. The current administration will roll back, according to Interior Secretary Doug Burgum, as much as 20% – 30% in order to promote the use of fossil fuels.

Environmentalists are in total uproar over Trump’s attack on climate change and have vowed to fight him tooth and nail through the courts. A previous administrator under President Obama declared “today marks the most disastrous day in EPA history, rolling these rules back is not just a disgrace, it’s a threat to all of us”. Jason Rylander, the Legal Director at the Centre for Biological Diversity Climate Law institute said, “Come hell or high water, raging fires and heatwaves, Trump and his cronies are bent on putting “polluter profits” ahead of people’s lives, we are going to fight it every step of the way”. Analysts suggest that the Donald may find this piece of legislation more difficult to pass than previously anticipated.

Greenland

On 13th March 2025, President Donald Trump met with the Secretary General of NATO, Mark Rutte, where the President appeared to double down on his plans to annex Greenland. Politicians in Greenland have issued a joint statement condemning President Trump, saying his behaviour is unacceptable. The out-going premier, Mute B Egede, wrote on Facebook “Our country will never be the USA and we Greenlanders will never be Americans”.

Experts say that President Trump feels that control over Greenland is essential for national and international security, with experts advising that if Russia were to fire nuclear missiles at the USA, the quickest route would be via the North Pole and Greenland. However, a January 2025 poll of Greenlanders suggest that 85% rejected becoming part of the United States while 6% were in favour, the rest being undecided.

President Trump has a taste for rare minerals especially as China has an advantage in this arena, and it is felt that there are a number of these minerals to the south of Greenland which may have also caught his attention. However, one thing is certain: President Trump does not appear to give much thought to sovereignty, especially with his comments on Canada and actions over the Ukraine but attempts to annex Greenland may be a political step too far in the global geopolitical arena.

Conclusion

Whilst many may react with horror regarding President Trump’s approach to climate change and dismay at his attitude towards sovereignty, he has managed to pull in significant investment into the United States. A number of manufacturers and businesses both in the United States and overseas have, since Donald Trump took office, announced billions of US Dollars in investments.

These companies include such luminaries as Apple, which has pledged a USD 500 Billion investment securing 20,000 jobs, Mercedes Benz has pledged to grow its vehicle production in America, Stellantis has announced it will build their latest Dodge Durango in Michigan, and let’s not forget Saudi Arabia which has pledged a USD 600 Billion to the United States over the next four years.

Finally, it must be remembered that with Donald Trump, it’s not politics that drives him forward, but “the deal”. The deal which will make America great again no matter the geopolitical cost, the political cost at home, or lives lost in the Middle East between Gaza and Israel, and in the war between the Ukraine and Russia. If there is a deal to be had with the United States as the winner, President Trump will pursue that trade to the bitter end. In the election, he won the popular vote as well as electoral vote, so he feels he has the right to govern his way. Is he correct? Only time will tell.