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Welcome to Hedge Clippings' last edition for the 2025 Financial Year!
Firstly, let's address the weekly Trump comment. We don't always - in fact rarely do we - sympathise with The Donald, but his outburst this week, publicly dropping the "f" bomb directed at the leaders of Israel and Iran, showed his frustration. Realistically, he probably reflected the opinions of millions of others around the world, irrespective of which side one does, or doesn't support (if either). There can't be many people who were actually offended by the word itself, which is now so commonplace as to be part of everyday language on TV or in the media.
It just took Donald to use it on the lawn of the White House!
Once over in the Hague at the NATO meeting, Trump reverted to hammering Jerome Powell, calling him "a very average mentally person." with "a low IQ for what he does", and is very political. Basically, Trump dislikes Powell because he won't do as Trump wants him to. Meanwhile, to date, Powell and the FOMC haven't flinched, preferring to wait and see what the inflationary and economic outcomes are after the tariff pause due on July 9 for the rest of the world, and mid-August for China.
Meanwhile, Australia's monthly CPI for May came in this week at 2.1% for 12 months vs. the previous month's number of 2.4%, the same as the trimmed mean result, which was also down from the previous month's figure of 2.8%. One would have to think, in spite of the global uncertainty, that the RBA will not be as cautious as the US Fed when they announce the result of the next board meeting on July 8th.
Meanwhile, approaching the end of the financial year, equity markets both here and in the US are heading for another year of double-digit returns, each up over 13% for the 12 months to the end of May. That will make it three years in a row of returns in the 11-13% range, in spite of global volatility and uncertainty.
While it will be a few weeks before the funds' June returns, and therefore 12-month performances, hit the database, early anecdotal evidence suggests that the top equity-based fund managers will comfortably double, or in some cases triple, the returns of their respective indices.
Watch this space!
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