Read Money Minder's detailed April 25 Market Insights Report - Trump Trade Wars 

Inflation went down (a little) in February (the ONS data for the 12 months to February 25 was released on 26 March 25) but not as much as you may have been led to believe in the press. It’s now highly likely to start going up again, at least in the short term. Tariffs are often and widely reported as inflationary. However, in reality it will depend on how much of the tariff costs manufacturers are able to pass on to the consumer. In the short term we can expect many companies to try to do that, but they may not be successful in doing so.

If consumers stop buying their products because they are just too expensive, companies will have to think again about their pricing structures. If consumers choose to ‘batten down the hatches’ on their spending, potentially, companies may need to bring their prices back down in order to survive a downturn. That’s deflationary over time as opposed to inflationary. Reducing prices means companies will need to reduce their overheads for both raw material costs (and potentially labour costs) and in turn can lead to lower profits. Lower profits means lower share prices due to a reduction in corporate earnings.

Interest rates have been reducing in the UK, Europe and in the US since last summer, but not by much. Central banks are now worried that to reduce rates further in the short term, alongside increased costs due to new tariffs, it could ignite the already ‘sticky’ inflation problem they are desperately trying to manage.

Global stock markets experienced a very fast & very significant drop in values in early April, immediately after ‘Liberation Day’ on 2nd April 2025. There was a reasonable bounce on 8th April but this could be short lived. We now have a clear sign that potentially, a sale is on its way which could provide investors with some significant bargains to ‘stock up’ on.

If the economy stalls & markets continue to fall in value, which is now widely expected, interest rate reductions may come later as central banks feel more comfortable about lowering interest rates that hopefully won’t stoke up even more inflationary pressures.

Markets are expecting central banks to cut interest rates if a global recession ensues, and if they’re right, fixed interest rates on deposit based savings accounts and corporate bond yields will fall which may then lead to the capital values of those corporate bonds going up.

Despite Elon Musk’s recent appointment to Trump’s new cost-saving initiative called the ‘Department of Government Efficiency’ (DOGE), US debt levels continue to rise at around $3 trillion per year. The US debt clock now stands at an incredible $36.7 trillion!  In addition, if Jerome Powell (Chair of the Federal Reserve of the United States) continues to defy Trump regarding lowering interest rates because of his concerns about inflation, higher interest rates for longer will increase the cost of borrowing for both the Administration and consumers. Higher borrowing costs are a global issue, it’s not something that only the Americans need to worry about.

With higher borrowing costs and higher living costs, it’s become difficult to find buyers for residential homes, Buy-to-Let investors and commercial properties. Now that the Stamp Duty holiday is also over, which means buyers’ costs have risen, some owners are struggling to sell their properties and are now reducing their asking price on a monthly basis in an attempt to attract potential buyers.

Geopolitical tensions continue to cause concern. The BRICS+ Trading Group has expanded significantly over the last 18 months. They recently publicised the development of a new cross border trading platform/payment system to allow members to trade between themselves without having to use the American owned ‘Swift Payment System’.

Now that the market correction concerns that I have been writing about and discussing with our clients since April 23 are starting to unfold, some profitable buying opportunities are also starting to present themselves!

Read on for a more detailed analysis and information that will help you to consider what action you may wish to consider taking in the next few weeks and months?

If you’re concerned about market volatility, or curious about how to position your portfolio to take advantage of emerging opportunities, please don’t wait for your next scheduled review. Reach out to us today to discuss your options.

Whether it’s preserving your wealth, reassessing your risk, or being ready to invest when the time is right, our team is here to support you.

Read Money Minder's detailed April 25 Market Insights Report - Trump Trade Wars 

If after reading this report you’d like to review your portfolio or explore our latest investment strategies, please call us on 01529 300 300.