Observe. Think. Chat. Do. Trade. Repeat…
This marks the seventh consecutive rate cut as the ECB continues its monetary easing cycle.
ECB President Christine Lagarde emphasised that inflation has fallen below the 2% target, but economic growth remains sluggish.
Investors are now watching for further rate cuts later in the year, with markets pricing in another 0.25% reduction in October.
This unexpected decline has sparked discussions about the potential consequences for the region’s economy.
The latest data from Eurostat shows that core inflation, which excludes volatile items like energy and food, also eased to 2.3%, down from 2.7% in April.
Services inflation, a key indicator of consumer demand, dropped sharply to 3.2% from 4%. These figures suggest that price pressures are cooling faster than anticipated.
While lower inflation can ease the cost of living for consumers, it also raises concerns about economic stagnation.
The ECB has been gradually cutting interest rates to support growth, and markets are now pricing in a 95% chance of another rate cut this week. However, if inflation continues to fall below target, it could signal weak demand and slow wage growth, potentially leading to deflationary risks.
Adding to the uncertainty, global trade tensions, particularly U.S. tariff policies, are clouding the economic outlook. The ECB will need to carefully balance its approach to ensure inflation remains stable while supporting economic expansion.
As policymakers prepare for their next decision, the eurozone faces a delicate challenge: maintaining price stability without stifling growth.
Investors are demanding higher yields because they’re worried about the GOP’s tax-cut plans, which could lead to increased borrowing and a larger deficit.
Additionally, the recent Trump tax bill has caused Treasury bond yields to surge, as investors anticipate more government debt issuance. Moody’s has also downgraded the U.S. credit rating, adding to market jitters.
The bond market’s reaction is significant because higher yields can lead to increased borrowing costs across the economy, affecting everything from mortgages to corporate financing.
Japan’s bond market is facing significant turbulence, with yields on 40-year government bonds hitting an all-time high. This surge in yields is causing concerns about capital repatriation, as Japanese investors may start pulling funds from the U.S. and other foreign markets.
The Bank of Japan’s reduced bond purchases have contributed to this trend, leading to weaker demand for long-term government debt. Analysts warn that if Japanese investors begin moving their capital back home, it could trigger a global financial market shake-up.
Additionally, Japan’s Finance Ministry is considering reducing the issuance of super-long bonds to stabilise the market. However, recent auctions have shown weak demand, raising concerns about the effectiveness of this strategy.
The European bond market is experiencing some shifts due to falling government bond yields and easing U.S. – EU trade tensions.
German 10-year bund yields dropped by 4 basis points, reflecting increased investor confidence.
UK and French 10-year bond yields also declined by 4 basis points, while Italian bonds saw a 2 basis point dip.
Long-term UK gilts experienced the biggest movement, with 20 and 30-year yields falling by 7 basis points.
This decline in yields suggests higher demand for European government debt, possibly due to investors shifting away from U.S. assets amid concerns over U.S. fiscal health.
The UK bond market is facing some challenges, with the IMF warning that it is vulnerable to sudden shocks due to a growing reliance on hedge funds and foreign investors.
30-year gilt yields have hit 5.5%, the highest in over three decades.
The Bank of England’s quantitative tightening and increased bond issuance are putting pressure on the market.
The Debt Management Office (DMO) is shifting towards short-dated debt to reduce long-term interest costs.
Additionally, the UK government has launched a new 30-year gilt offering 5.375% interest, which is attracting investor attention.
Donald Trump’s first 100 days in office during his second term have been a whirlwind of activity, marked by bold moves and significant controversy.
His poll rating is the lowest of any President of recent times for the first 100 days. It currently sits at around 41% (a CNN poll result suggests).
Harry S. Truman, hit a rock-bottom approval rating of 22% in 1952. Other presidents like Richard Nixon and George W. Bush also dipped below 25%. But these were during their terms and not in the first 100 days.
His administration has focused heavily on reshaping trade policies, imposing tariffs that have disrupted global markets and strained relationships with long-standing allies.
Despite his claims of progress, no major trade deals have been finalised, leaving many questioning the effectiveness of his approach.
Domestically, Trump’s policies have faced significant legal challenges, with numerous lawsuits filed against his administration. His stance on immigration and energy has sparked heated debates, reflecting the polarising nature of his decisions.
Trump’s ‘drill-baby-drill’ mantra has not had the desire reaction – oil prices has fallen with U.S. oil below $65 a barrel.
The automotive industry, for instance, has grappled with regulatory uncertainty and additional costs due to his tariffs, prompting him to soften some measures in response to industry concerns.
Internationally, Trump’s actions have raised concerns about U.S. credibility and stability. His hostile stance toward traditional allies, such as Canada, the EU and NATO, has left multi-decade relationships in tatters.
Meanwhile, his administration’s handling of the ongoing war in Ukraine and trade negotiations with China has drawn criticism for its lack of tangible results.
Despite these challenges, Trump remains confident in his vision for America. He has claimed progress in tariff negotiations with India, suggesting that a trade deal may be on the horizon.
There has not been a single trade deal concluded with Trump’s administration – despite him reportedly claiming to have done ‘200 deals’ with only 195 countries in the world.
China is still striking a defiant tone on trade, and the war in Ukraine rages on. The president has also been forced to walk back on his “reciprocal tariffs.”
However, his administration’s approach has left many wondering whether his first 100 days will be remembered for their impact or their controversy.
As the dust settles, the world watches closely to see how Trump’s policies will shape the future of the United States and its role on the global stage.
Trump may have wanted his first 100 days to be historic, and they were – but for all the wrong reasons.
This decision aims to counter economic growth concerns fueled by global trade tensions, particularly the impact of tariffs imposed by the United States.
The ECB’s move is expected to make borrowing more affordable, supporting consumer spending and business investment.
Inflation in the eurozone has fallen to 2.2%, close to the ECB’s target, shifting the focus to growth worries.
The eurozone economy grew by a modest 0.2% in the last quarter of 2024, highlighting the need for measures to stimulate activity.
The ECB’s decision reflects the challenges posed by trade uncertainties and the potential impact of tariffs on European industries.
This means the index has fallen more than 20% from its all-time high in late November 2024. The decline was accelerated by the recent rollout of President Donald Trump’s sweeping tariffs, which have raised concerns about rising costs, economic softening, and global supply chain disruptions3.
Small-cap stocks, which were initially seen as beneficiaries of Trump’s policies due to their domestic focus, are now facing significant challenges. Many of these companies are particularly vulnerable to input cost shocks and lack the financial flexibility of larger firms.
Analysts warn that the combination of higher costs and a slowing economy is squeezing profits, leaving small caps in a precarious position.
The Russell 2000’s downturn highlights the broader market volatility triggered by the tariff measures. While other major indices like the S&P 500 and Nasdaq are in correction territory, the Russell 2000 was the first to enter a bear market.
Russell 2000 index
This development underscores the heightened risks for small-cap stocks in the current economic climate.
Despite the challenges, some strategists believe there could be opportunities for recovery, particularly if the Federal Reserve takes steps to cut interest rates.
However, Trump’s tariffs have introduced uncertainty into this policy, as inflation is likely to increase, casting doubt on the possibility of further interest rate cuts.
For now, the Russell 2000’s performance serves as a stark reminder of the delicate balance between protectionist policies and market stability.
The Russell 2000, a key benchmark for small-cap U.S. stocks, has officially entered bear market territory.
The Dow Jones Industrial Average has seen a sharp decline, falling from its all-time high of 45,073.63 points in December 2024 to its current level of 38,314.86 points—a drop of approximately 15%.
Dow Jones one-year chart
This downturn reflects a mix of economic challenges, including the impact of President Donald Trump’s tariff policies.
Trump’s sweeping tariffs, introduced as part of his ‘Liberation Day‘ initiative, aimed to bolster American manufacturing by imposing taxes on imported goods. While the policy sought to ‘level the playing field’, it triggered significant disruptions in global trade.
Retaliatory tariffs from key trading partners, including China and the European Union, compounded the issue, ultimately leading to higher costs for U.S. businesses and consumers.
The tariffs have also strained supply chains, particularly in industries reliant on international components. This has contributed to inflationary pressures, further dampening investor sentiment.
The tech sector, already grappling with regulatory scrutiny, has been hit hard, with companies facing increased production costs.
Nasdaq tech 100 one-year chart
While some view the market’s decline as a natural correction, others warn of prolonged economic challenges, especially with the uncertainty surround Trump’s tariff agenda.
For investors, the key lies in navigating these turbulent times with caution and a focus on long-term fundamentals.
As the Dow adjusts to these pressures, its performance underscores the far-reaching consequences of trade policies on global markets.
S&P 500 one-year chart
These measures include tariffs on steel, aluminum, and a wide range of goods from countries like China, Canada, and the European Union.
While supporters argue that these tariffs have bolstered domestic manufacturing and created jobs, critics highlight the retaliatory tariffs imposed by other nations, which have affected American exporters.
President Donald Trump said he will soon announce tariffs targeting automobiles and pharmaceuticals.
Trump later added the timber and semiconductor industries to his list.
It was unclear whether the newly announced sector-specific tariffs would take effect after the tit-for-tat ‘reciprocal tariffs’ – which are set to take effect on for 2nd April 2025
The president’s latest comments at a Cabinet meeting came hours after he unveiled a plan to place 25% tariffs on all countries that buy oil and gas from Venezuela.
Higher Prices for Consumers
Tariffs increase the cost of imported goods, which often leads to higher prices for consumers. This can reduce purchasing power and affect living standards.
Impact on Businesses
Companies relying on imported materials face higher production costs due to tariffs. Some businesses may pass these costs onto consumers, while others might struggle to remain competitive.
Retaliatory Measures
Countries affected by U.S. tariffs often impose their own tariffs on American goods. This can hurt U.S. exporters and lead to trade wars.
Economic Growth
Studies suggest that tariffs can reduce GDP growth. For example, the U.S. GDP has been estimated to decrease by 0.4% due to these measures.
Employment
While tariffs aim to protect domestic jobs, they can also lead to job losses in industries affected by higher input costs or reduced export opportunities.
Global Trade Dynamics
Tariffs disrupt international trade relationships, leading to uncertainty and reduced investment in affected sectors.
These measures have sparked retaliatory tariffs from other countries, creating a complex web of trade disputes further sowing chaos and unrest.
Markets have reacted negatively to Trumps tariffs.
One thing is certain regarding the imposition of Trump’s tariffs – consumers suffer!
On 4th March 2025, President Donald Trump announced a sweeping increase in tariffs on steel and aluminum imports, raising them to 25% across the board. This move, aimed at bolstering domestic industries, has sparked widespread reactions both domestically and internationally.
The tariffs, which now include a broader range of products such as nuts, bolts, and soda cans, have drawn sharp criticism from key U.S. allies, including Canada, the United Kingdom, and Australia.
The European Union has responded with countermeasures, imposing tariffs on $28 billion worth of American goods, set to take effect on 1st April 2025. European Commission President Ursula von der Leyen expressed regret over the U.S. decision but emphasised the need to protect European consumers and businesses.
Domestically, the tariffs have been met with mixed reactions. While U.S. steel and aluminum producers have welcomed the measures, citing potential job creation and increased investment, downstream manufacturers that rely on these metals are bracing for higher costs.
Economists warn that the tariffs could lead to increased prices for consumers and potential disruptions in supply chains. Trump has indicated many times that the tariffs levelled at the U.S. are unfair and unequal.
The Trump administration has justified the tariffs as a means to encourage foreign companies to establish manufacturing facilities in the United States. However, critics argue that the policy could backfire, leading to retaliatory measures from trading partners and a potential slowdown in global economic growth.
As the global trade landscape continues to evolve, the long-term impact of these tariffs remains uncertain. Businesses and policymakers alike are closely monitoring the situation, weighing the potential benefits of protecting domestic industries against the risks of escalating trade tensions.
The coming weeks and months will be crucial in determining the effectiveness of this bold and possibly misguided economic strategy.
The trade relationship between the U.S. and Canada has recently faced significant strain due to escalating tariff policies.
President Donald Trump announced a sharp increase in tariffs on Canadian steel and aluminum, raising them from 25% to 50%. This decision was reportedly in response to Ontario’s provincial government imposing higher electricity prices on U.S. customers.
However, after discussions between Ontario Premier Doug Ford and U.S. Commerce Secretary Howard Lutnick, Ontario agreed to pause the electricity surcharge.
As a result, the U.S. decided to maintain the original 25% tariff rate instead of doubling it. Despite this temporary resolution, tensions remain high, with Canada preparing to implement retaliatory tariffs on $30 billion worth of American goods.
These developments highlight the ongoing challenges in U.S. – Canada trade relations, with both nations navigating the complexities of economic and political interests.
The U.S. – China trade tensions have escalated significantly in recent months. President Donald Trump recently imposed a 20% tariff on all imports from China, reportedly citing concerns over China’s role in the flow of fentanyl into the U.S.
This move has reignited the trade war that began during Trump’s first term.
In response, China has implemented retaliatory measures, including a 15% tariff on U.S. liquefied natural gas (LNG) and coal, as well as a 10% tariff on crude oil, agricultural machinery, and large-engine cars.
Additionally, China has restricted the export of rare earth minerals and metals, which are critical for U.S. tech and green energy industries.
Both nations have expressed a willingness to engage in dialogue, but the situation remains tense. The economic impact of these tariffs is being closely monitored, as they have the potential to disrupt global supply chains and affect industries worldwide.
The U.S. – Mexico trade conflict has intensified with the U.S. imposing a 25% tariff on Mexican imports, excluding oil and energy products, which face a 10% tariff.
This decision, aimed at addressing trade deficits and border concerns, prompted Mexico to announce retaliatory tariffs targeting $20 billion worth of U.S. goods. Critics argue these measures undermine the United States-Mexico-Canada Agreement (USMCA) and could disrupt supply chains.
Both nations are bracing for the economic impact, with businesses and consumers facing potential cost increases. This trade dispute highlights the challenges of balancing domestic priorities while maintaining strong international partnerships in a connected global economy.
Russia and Ukraine peace deal according to Trump. Taking rare earth and other minerals from Ukraine in a ‘deal’. The potential reshaping of Gaza to become the riviera of the middle east. Talk of taking over Greenland. Making Canada the 51st state. etc. etc.
And this is just what we already know after 8 weeks of Trump in power!
The bank stuck to its plan in the face of economic challenges, including threats of U.S. tariffs and plans to boost European military spending.
This move reflects a shift in focus from combating inflation to supporting economic growth in the Eurozone.
Inflation has eased to 2.4% in February, and the ECB expects it to stabilise around its 2% target.
Economic growth forecasts for 2025 and 2026 have been lowered to 0.9% and 1.2%, respectively.
U.S. tariffs, which include a 25% levy on imports from Canada and Mexico and a 10% increase on Chinese goods, have sparked fears of a global trade war. Retaliatory measures from Canada and China have only added to the uncertainty, sending shockwaves through financial markets worldwide.
The FTSE 100, London’s blue-chip index, fell by 1.3%, marking its steepest decline since October last year. Across the Atlantic, Wall Street saw significant losses, with the S&P 500 dropping 1.6% and the Dow Jones Industrial Average falling 1.7%. European markets were not spared, as Germany’s DAX and France’s CAC 40 plunged by 3.5% and 2.1%.
Investors are increasingly concerned about the long-term implications of these tariffs. The measures threaten to disrupt global supply chains, inflate costs, and dampen economic growth. Analysts warn that prolonged trade tensions could push the global economy closer to a recession.
The tariffs have also had a notable impact on currency markets. The U.S. dollar weakened against major currencies, with the pound rising to a six-week high of $1.27. Meanwhile, safe-haven assets like gold saw a surge in demand, with prices climbing above $2,900 per ounce.
Oil markets were not immune to the fallout, as Brent crude futures dropped to a three-month low of $70.65 per barrel. The decline reflects growing concerns over reduced demand amid escalating trade tensions.
As the world braces for further economic uncertainty, the focus now shifts to how global leaders will navigate these turbulent waters.
The stakes are high, and the path forward remains uncertain.
The tariffs, which include a 25% duty on imports from Mexico and Canada, as well as a 10% levy on Chinese goods, have led to significant market volatility.
Investors remain cautious as they assess the long-term implications of these trade restrictions. The tariffs are expected to raise inflation in the U.S. and could potentially lead to a severe market correction.
It’s a complex situation with far-reaching consequences for global trade and the economy.
The S&P 500 retreated on Monday, extending February’s rout and turning red for the year after President Donald Trump’s confirmation of forthcoming tariffs.
The S&P 500 index fell to end at 5849, marking its worst day since December 2024 and bringing its year-to-date performance to a loss of about 0.5%.
The Dow Jones Industrial Average dropped 649 points to finish at 43191. The Nasdaq Composite slid to close at 18350, weighed down by Nvidia’s decline of more than 8%.
Stocks took a notable leg down in the afternoon following President Trump’s reiteration that 25% levies on imports from Mexico and Canada would go into effect on Tuesday 5th March 2025, dashing investors’ hopes of a last-minute deal to avert the full tariffs on the two U.S. allies.
All three indexes traded in positive territory earlier in the day, with the Dow rising nearly 200 points at session highs.
China retaliated with reciprocal tariffs of 15% on some U.S. goods due to take effect 10th. March 2025.
Is the world order being dramatically upended?
Britain’s minister for AI and digital government, Feryal Clark, emphasised the importance of the UK developing its own regulatory framework for AI.
She highlighted the government’s strong relationships with AI companies like OpenAI and Google DeepMind, which have voluntarily opened their models for safety testing. Prime Minister Keir Starmer echoed these sentiments, stating that the UK now has the freedom to regulate AI in a way that best suits its national interests following Brexit.
Unlike the EU, which has introduced comprehensive, pan-European legislation aimed at harmonising
Instead, it has deferred to individual regulatory bodies to enforce existing rules on businesses developing and using AI. This approach contrasts with the EU’s risk-based regulation and the U.S.’s patchwork of state and local frameworks.
During the Labour Party’s election campaign, there was a commitment to introducing regulations focusing on ‘frontier’ AI models, such as large language models like OpenAI’s GPT. However, the UK government has yet to confirm the details of proposed AI safety legislation, opting instead to consult with the industry before formalising any rules.
The UK’s AI Opportunities Action Plan, endorsed by tech entrepreneur Matt Clifford, outlines a comprehensive strategy to harness AI for economic growth.
The plan includes recommendations for scaling up AI capabilities, establishing AI growth zones, and creating a National Data Library to support AI research and innovation. The government has committed to implementing these recommendations, aiming to build a robust AI infrastructure and foster a pro-innovation regulatory environment.
Despite the ambitious plans, some industry leaders have expressed concerns about the lack of clear rules. Sachin Dev Duggal, CEO of AI startup Builder.ai, reportedly warned that proceeding without clear regulations could be ‘borderline reckless’.
He reportedly highlighted the need for the UK to leverage its data to build sovereign AI capabilities and create British success stories.
The UK’s decision to ‘do its own thing’ on AI regulation reflects its desire to tailor its approach to national interests and foster innovation.
While this strategy offers flexibility, it also presents challenges in terms of providing clear guidance and ensuring regulatory certainty for businesses. As the UK continues to develop its AI regulatory framework, it will be crucial to balance innovation with safety and public trust
The reading, according to economists’ forecasts, indicated an increase from a revised 2.2% figure in November 2024. Core inflation remained steady at 2.7% for the fourth consecutive month, meeting economists’ expectations, while services inflation edged up to 4% from 3.9%.
Headline inflation was widely expected to accelerate after hitting a low of 1.7% in September 2024, as the effect from lower energy prices fade.
The European Central Bank will monitor the full extent of increases in the reading, as well as persistence in services and core inflation. Markets currently anticipate that the ECB will reduce rates from 3% to 2% through several cuts this year.
The introduction of new regulations, particularly in regions like the European Union and the United States, will create both challenges and opportunities for investors.
One of the most anticipated regulatory developments is the European Union’s AI Act, which aims to set a global standard for AI regulation. This act is expected to impose stringent requirements on AI systems, particularly those used in high-risk sectors such as healthcare, finance, and law enforcement.
Companies operating in these sectors will need to invest heavily in compliance, which could lead to increased operational costs and potentially affect their profitability. As a result, stocks of companies heavily reliant on AI technologies may experience volatility as investors react to these new regulations.
In the United States, the political landscape is also shifting, with the incoming administration expected to take a more hands-on approach to AI regulation. President-elect Donald Trump has appointed Elon Musk to co-lead a new ‘Department of Government Efficiency – DOGE‘, which will focus on nascent technologies like AI. Musk’s influence and experience in the AI field could lead to more favourable policies for AI development, but it could also result in increased scrutiny and regulation of AI applications. Musk’s AI vision differs to that of Mark Zuckerberg’s for instance.
This dual approach of promoting innovation while ensuring safety and ethical use of AI could create a dynamic and unpredictable market environment.
The impact of AI regulation on the stock markets will not be uniform across all sectors. While companies in high-risk sectors may face challenges, those in industries like healthcare and finance could benefit from AI’s transformative potential.
For example, AI-driven innovations in healthcare, such as predictive diagnostics and personalised treatment plans, have the potential to revolutionize patient care and reduce costs. Companies that successfully integrate AI into their operations and comply with regulatory requirements could see their stock prices rise as investors recognize the long-term value of these advancements.
However, the regulatory landscape is not without its risks. Companies that fail to adapt to new regulations or face compliance issues may see their stock prices suffer. Additionally, the rapid pace of technological change means that regulations may struggle to keep up, leading to potential legal and financial uncertainties for companies operating in the AI arena.
AI regulation in 2025 is likely to create a complex and dynamic environment for the stock markets. While new regulations will pose challenges for some companies, they will also open up opportunities for those that can navigate the regulatory landscape successfully.
Investors will need to stay informed and agile, as the impact of AI regulation on the stock markets will be both significant and multifaceted.
Both core inflation and services inflation reportedly remained the same as the previous month.
The markets are anticipating a 0.25% reduction in interest rates by the European Central Bank in December 2024, while analysts have suggested that the latest figures could sway the argument against a more substantial cut.
A reduction of 0.5% has been muted but is now less likely.
Economists had anticipated a growth of 0.2%, following a 0.3% increase in the second quarter.
Analysts predict that euro zone growth may pick up cautiously in the upcoming months, in light of lower interest rates and subsiding inflation.
At its October 2024 meeting, the European Central Bank (ECB) reduced rates for the third time this year, following a final reading of September’s EU headline inflation at 1.8%.
The ECB pointed to sustained indications of sluggish activity in the euro area as a significant reason for the rate cut in October.
Markets have completely factored in another 0.25% reduction by the ECB for its final meeting of the year in December 2024.
Germany, the largest economy in the euro zone, reported an unexpected 0.2% growth in the third quarter, as per figures released on Wednesday 30th October 2024. This growth helped the country steer clear of the recession predicted by some economists.
At its October meeting, the central bank decreased the deposit rate by 0.25%. This decision followed a slowdown in the euro area’s price increases to 1.8% in September 2024, falling below the central bank’s target of 2%.
The EU interest rate is now: 3.25%
‘The European Commission’s proposal to levy definitive countervailing duties on imports of Chinese battery electric vehicles has garnered the requisite support from EU Member States to proceed with the imposition of tariffs,‘ stated the EU.
Initially, the EU announced in June its intention to impose higher tariffs on imports of Chinese electric vehicles, citing substantial unfair subsidies that threaten economic harm to European electric vehicle manufacturers.
The EU disclosed specific duties for companies based on their level of cooperation and the information provided during the bloc’s investigation into China’s EV production, which commenced last year. Provisional duties have been in effect since early July.
Following the receipt of ‘substantiated comments on the provisional measures‘ from stakeholders, the European Commission updated its tariff strategy in September 2024.
A spokesperson from China’s Ministry of Commerce indicated that Beijing maintains its stance that the EU’s investigation into China’s electric vehicle industry subsidies has led to predetermined outcomes – suggesting that the EU is fostering unfair competition.
China responded by vowing a suitable response.
The settlement’s roots trace back to 2016 when the European Commission deemed that Apple had received illegal state aid via favorable tax deals with Ireland. After prolonged legal disputes, the EU court’s verdict has concluded the issue, mandating Apple to settle the substantial amount.
The Irish government has devised a strategic plan to capitalise on this unforeseen fiscal advantage. The funds are designated for various key sectors to promote sustained economic growth and societal welfare. A considerable portion is allocated for infrastructure enhancements, including transport network upgrades and sustainable energy initiatives, in line with Ireland’s green economy transition goals.
The windfall will also bolster progress in healthcare and education. Plans are in place to improve healthcare facilities and services, enhancing access and care quality for residents. In education, investments will focus on updating educational institutions, fostering research and innovation, and preparing the workforce with future-oriented skills.
The financial influx also presents a chance to tackle housing deficits, with investments directed towards boosting affordable housing availability and ameliorating living standards nationwide. This comprehensive strategy aims to forge a more equitable and thriving society.
In essence, Ireland’s $14 billion windfall from Apple offers an exceptional opportunity to effectuate considerable improvements across diverse sectors, potentially reshaping the country’s economic and social fabric for generations.
It’s quite remarkable how a fortune from just ONE company can be utterly transformational for an entire country.
As of September 2024, Apple’s market cap sat at around $3.4 trillion. This makes Apple the most valuable company in the world by market cap.
Just so you know, 14 billion of 3.4 trillion equals about 0.41%. A small drop in a massive financial ocean.
Excluding the more volatile prices of energy, food, alcohol, and tobacco, the core inflation rate stood at 2.7%, marginally below the anticipated forecasts.
This inflation figure matched the predictions of economists.
This expected decision follows a period of sluggish economic growth in the eurozone and a decrease in inflation, which approached the central bank’s 2% target in August.
The EU interest rate is now 3.5%.
The case dates back to 2016, when the European Commission directed Ireland to reclaim up to 13 billion euros ($14.4 billion) in unpaid taxes from Apple.
The Commission had determined that Apple benefited from ‘illegal’ tax advantages in Ireland for twenty years.
The ruling stems from a 2017 antitrust investigation by the European Commission, the executive arm of the European Union.
The Commission reportedly found that Google had unfairly favoured its own shopping comparison service, to the detriment of rival services.
The core inflation rate, which excludes the volatile elements of energy, food, alcohol, and tobacco, dropped to 2.8% in August from July’s 2.9%, aligning with predictions.
Market expectations have fully incorporated a 0.25% rate cut by the ECB in September 2024, following its initial rate reduction in June 2024, with anticipation of an additional 0.25% reduction before year-end.
This follows a slowdown in price increases in Germany, the largest economy in the eurozone, which cooled to an unexpected 2% for the month, according to the index of consumer prices.
The Nasdaq, known for its tech-centric portfolio, along with the Dow Jones Industrial Average and the S&P 500, all ended the day in more positive territory.
This ‘lift’ came after a period of muted activity in UK and European markets, with London’s FTSE 100 experiencing an initial surge before retreating.
In Japan, the Nikkei 225 stock index recorded a substantial rise of 10.2%, or 3217 points, marking its largest single-day point increase following a steep drop the day before.
The recent turmoil in the stock market was triggered on Friday 2nd August 2024 by unsatisfactory U.S. job data for July 2024, which indicated an increase in unemployment, raising alarms over a potential recession.
Additionally, there has been growing apprehension that stocks of major technology firms, especially those with significant investments in artificial intelligence (AI), may have been excessively valued, leading to challenges for some of these companies.
Core EU inflation, which omits the more volatile prices of energy, food, alcohol, and tobacco, reached 2.9% in July, surpassing expectations.
Services inflation, a closely monitored indicator, registered at 4% for July, marking a slight decrease from the 4.1% figure in June.