Trump drops by the Fed
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How is President Trump pressuring Jerome Powell during his Fed visit?
So the pressure mounts on Jerome Powell to cut rates. President Trump is dropping by about now to say what he really thinks of the Fed chair. And let's not assume an August rate cut from the RBA. That seems to be the takeout from the message from Michelle Bullock in Sydney yesterday. We'll look at what exactly she did say. And the same for the ECB, who kept rates on hold. But where next? and the PMIs, the overs and unders, plus durable goods orders today from the United States, UK retail sales, and more, like earnings and tariffs, for example. It's Friday, it's the 25th of July, 2025. It's the Morning Call from NAB. Good morning. Good morning. Well, US stocks doing OK today, except for the Dow, which fell 0.7%.
But the Nasdaq was up 0.2%. The S&P closed up just 0.1%. But it did hit 6,381, which is another, yet another record high today. The FTSE 100 in the UK also hitting a new high in this session, up almost 0.9% on the day. That's in sharp contrast to the CAC current, which is down 0.4%. And that result for the FTSE way more than the Eurostox 50, which is up just 0.2% today. The US dollar is up 0.2%, the Aussie down just enough to slip below 66 US cents. The euro also looking pretty flat this session, but a 0.3% fall in the yen, in the Swiss franc and in the Canadian dollar. And 10-year bond yields rose quite a bit in Europe, up eight basis points in France and Spain, up nine in Italy, six in Germany. But just two basis points for 10-year treasuries and UK 10-year gilt yields actually fell a tiny bit in this session.
And Aussie 10 years yesterday finished at 4.35%. Now on futures, they are four basis points higher than that. And oil is high as well, 1.5% added to WTI. Brent is up 1.3%, taking it close to 69.40 a barrel. And NAB's Ray Attrell is with me today.
Did the ECB’s decision to keep rates on hold signal the last rate cut of the cycle?
Let's start, Ray, with the ECB. Rates on hold yesterday after seven straight cuts. So is that it? Even if the economy is looking weak later in the year, have we seen the last cut from the ECB for
now? Yeah, morning, Phil. The market doesn't agree with that. The market still thinks that there is at least one more cut to come, although it certainly has trimmed pricing compared to where we were in the lead up to the ECB. So at that point, there was something like 22 basis points of additional cuts priced for the end of the year. That's come into about 17 basis points. And I think the You know, the overall tone of the press conference from Madame Lagarde was sort of probably sort of cautiously, hawkish is probably the wrong word, but certainly said that policy was in a good place. And we had reports, you know, after the meeting suggesting that effectively that the barrier to policy further cuts is actually pretty high.
So but the usual sort of overs and unders and nothing being ruled in or out, you know, just to reiterate policy was left unchanged at 2% in case anybody wasn't sure whether they did that. And, you know, views that, you know, euro basically rising would probably be unwelcome, but that's only in the sense that it would put downward pressure on inflation. Tariff uncertainty, obviously, is still there. She's quizzed about whether, you know, and suggesting that there could be some improvement in sort of sentiment of confidence if we do get a deal over the line, in which respect there's been sort of no developments that I've seen overnight, even though markets do seem to be travelling with a degree of optimism that something akin to that Japan-US deal agreed earlier in the week
um, is on the table. So, um, potentially that's something we could hear about, um, you know, later during the Australian day. So, uh, and if so, that'll probably be, um, swamp any other news that we see, but, but no, no, no real surprises, I would say. And, um, and no really sort of strong reaction. We did see a sort of a little bit of a Euro pickup, but generally the, um, some of the dollar weakness that we had sort of, um, on Wednesday and during our session yesterday has come back a little bit, but I'll argue that, um, U.S. data, which we'll get to momentarily, has probably had the bigger role in that.
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Chapters
8 chapters
1
How is President Trump pressuring Jerome Powell during his Fed visit?
0:01–1:56
2
Did the ECB’s decision to keep rates on hold signal the last rate cut of the cycle?
1:56–4:12
3
What did Michelle Bullock say about the RBA’s August rate‑cut expectations?
4:12–7:04
4
What do the latest PMI figures reveal about US services strength versus European manufacturing weakness?
7:04–9:48
5
Why did Tesla’s earnings surprise cause a sharp stock decline after an initial rally?
9:48–12:02
6
How are foreign investor flows influencing recent US dollar weakness?
12:02–14:21
7
Will Japan’s July CPI keep the BOJ from raising rates this year?
14:21–16:50
8
What impact will the upcoming US durable‑goods orders, especially Boeing, have on the market?
16:50–18:34