Written by Shane Balkham
Last week was littered with speeches from central bankers, which would not normally generate too much attention, however one of those central bankers was newly appointed Federal Reserve governor Stephen Miran. It is suspected that Stephen Miran, who was appointed by President Trump to the board of the Federal Reserve just two weeks ago, was the outlier in the ‘dot plot’ forecasts.
Every quarter, each member of the Federal Reserve individually forecasts where they consider rates to be at the end of the year. Normally the spread between the highest and lowest dot is around 1%, however, in the dot plot forecast issued at the last Federal Reserve meeting, there was a significant outlier which was 1% below the other lowest forecast.
It means that cuts of 1% for the remainder of this year are expected by this member, in addition to the 0.5% expected by the majority of the committee. All doubts were erased when Stephen Miran’s speech to the Economic Club of New York was centred around reducing rates by 2%, arguing that the current level is too high, advising that he has concerns about the direction of the US jobs market and the risks of unnecessary layoffs.
The US continued to dominate the headlines, with President Trump’s comments on Ukraine and Russia, which presented a change of tone. This was followed by a proposed series of new trade tariffs. US buyers of foreign vanity units, soft furnishings, and pharmaceuticals will be subject to new tariffs. The furniture tariffs, applied on national security grounds, are likely to have a muted impact, as they are not high-frequency purchases, however, the 100% pharmaceutical tariff applies only to branded drugs, and constructing a factory in the US may lead to an exemption. Many pharmaceutical companies already have facilities in the US, so it may be relatively easy to superficially expand those facilities to avoid tariffs being applied.
Where the US is not dominating is in market returns. The range of geographical contribution to global equity returns has been high in 2025, particularly for UK investors investing in Sterling. Q1 saw European equities outperform (including UK equities), Q2 saw broad-based returns across global equities, and so far in Q3, with just two days to go, Emerging Market and Japanese equities have outperformed.
This year is demonstrating the importance of being appropriately diversified, both in terms of having a spread of different investments over different geographies, but also in having a spread of different asset classes.
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All the data contained in the communication is believed to be reliable but may be inaccurate or incomplete. Unless otherwise specified all information is produced as of 29th September 2025.
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