In the United States, confidence indicators are normalising after their sharp decline following Liberation Day. Real data continue to point to a gradual moderation in economic activity, further raising the spectre of recession.
We continue to anticipate a moderate slowdown in the US economy in 2025, followed by a rebound in 2026. This recovery should materialise as trade agreements with key partners are being finalised. The agreement reached with the European Union at the end of July set US tariffs on European products at 15%, a moderated increase compared to the previous 10%. The average tariff on US imports is now expected to be between 15% and 20%.
So far, these tariff hikes seem to have a limited impact on inflation, which should enable the Federal Reserve to cut rates as early as September, thereby providing further support for activity.
Against this backdrop, we have maintained our equity exposure, having benefited from the market rebound that began at the end of April. We are maintaining our positive bias towards European small and mid-caps, which should benefit from German fiscal stimulus and increased defense spending. In the US, we remain overweight in the information technology sector, particularly semiconductors and software.
In the short term, uncertainties persist regarding trade negotiations with China, and any market correction will again represent an opportunity to increase our exposure to risky assets.
Over the month, we increased our exposure to emerging bonds. In addition, we took advantage of the dollar's latest rebound to continue reducing our exposure in Swiss franc and euro accounts.
« The dollar faces structural issues that could lead to further depreciation » explains Marie Thibout, Senior Strategist & Economist at Mirabaud Asset Management.
Among other things, the budget deficit is widening rapidly, driven by the compounding effect of mandatory spending. In addition, the Trump administration seems to be tolerating some currency weakness. As hedging costs fall, underhedged foreign holders of dollars are increasing their overlay, adding further downward pressure on the currency.
