Our latest views on data, trends and events influencing the markets.

Stay informed with the latest market news and analysis from Federated Hermes

VIEW INSIGHTS

Monthly

Weekly

Capital Markets

we're thinking

we're watching

The S&P 500 hit a new record high, marking a rebound from the correction that began in February. President Trump announced an end to trade discussions with Canada owing to Canada’s digital services tax, which affects US tech firms. Canadian GDP looks set to decline 0.1% in May from the month before. Core PCE, the Federal Reserve’s preferred inflation gauge, rose to 2.7% in May versus expectations of 2.6%. In the Senate, the budget bill faced obstacles raised by the Senate parliamentarian. The Federal Reserve put forth a proposal to revise leverage requirements.

US securities markets will be closed on Friday, July 3, in observance of Independence Day. This week we’ll be looking at the Chicago Business Barometer (PMI) on Monday; the S&P final US manufacturing PMI, construction spending, ISM manufacturing, job openings, and auto sales on Tuesday; ADP employment on Wednesday; and initial jobless claims, the US employment report, the US trade deficit, S&P final US services PMI, ISM services and factory orders on Thursday. Our strategists and portfolio managers cover the latest geopolitical, market and economic trends in our Insights section.

What

June 30, 2025

Weekly

October 2022

Additional resources

view dashboard

Inflation dashboard

VIEW PAGE

Election Watch 2024

Fixed income

The durability of American financial exceptionalism came under scrutiny as investors weighed rotation into other markets. Japan’s economy contracted at a 0.7% annual rate in the first quarter, versus expectations of a 0.2% rate of decline. The Bank of England continued to cut rates in May and said it expected more cuts going forward. US and foreign officials entered upon negotiations to address the tariff impasse. In particular, Treasury Secretary Bessent discussed tariffs with China’s vice premier in Switzerland, leading to a pause of the more onerous tariffs. Oil prices recovered modestly after May’s sharp selloff, and gold ticked upward.

Tariffs and the US fiscal deficit were among the topics investors fretted over this month. Investors and consumers alike took heart at the lowering of tensions with China, with the University of Michigan consumer sentiment index rebounding. The GOP budget—the “Big Beautiful Bill”—passed the House by a single vote on May 22 and went to the Senate. The second release of first quarter gross domestic product confirmed that US GDP shrank at a 0.2% rate in the first quarter. Bond yields increased in May as did mortgage rates, while the US dollar index fell.

Economies

Resources

.....

December

.....

Job Openings and Labor Turnover

.....

Emerging Markets

.....

Consumer Price Index

.....

Federal Open Market Committee

.....

Global Financial Crisis

.....

Eastern Daylight Time

.....

Mortgage-Backed Securities

.....

Standard and Poor's

.....

Institute of Supply Management

.....

United States

.....

Emerging Markets

.....

Personal Consumption Expenditures

.....

Automatic Data Processing

.....

Mortgage-backed Securities

.....

Bank of England

.....

European Central Bank

.....

Purchasing Managers Index

.....

Emerging Markets

US economy

International economy

US Equity

The FTSE 100, Euro Stoxx 50, Nikkei, MSCI ACWI ex-USA and Shanghai Composite all rose in May.

May showed strong equity returns, as the market continued to rebound from the tariff selloff. Uncertainty continued, though, with a court ruling against Trump’s tariffs. Within the S&P 500, Information Technology, Industrials and Communication Services outperformed most, while Health Care, Energy and Real Estate fared worst.

International Equity

After a positive return in April, a shift in investor sentiment resulted in a negative return in May as measured by the Bloomberg US Aggregate Bond Index, which fell to a positive 2.45% YTD on Treasury weakness. High yield bonds rallied in contrast; the Bloomberg US High Yield 2% Issuer Cap Index improved 1.7%, as high yield spreads tightened. The US 10-year Treasury yield ended the month 24 basis points higher at 4.41% after another volatile month.

Liquidity

Equities

Economies

Liquidity

Fixed Income

Equities

Economies

June 2025

Monthly

At the May meeting, the Federal Reserve (the Fed) kept the federal funds rate at 4.25-4.50%, with no changes to the reverse repurchase rate or quantitative tightening plans. Chair Powell noted rising uncertainty regarding the economic outlook, citing increased risks of higher unemployment and inflation in the wake of the tariff announcements and resulting trade deal discussions. The market significantly decreased expectations for future rate cuts and Powell is likely happy to stick to his wait and see approach. We currently think the next cut will come in September. Treasury Secretary Bessent provided some clarity regarding the debt limit, urging Congress to come to a resolution before August. In other news, the newest tax bill from the House making the rounds leaves the municipal bond tax exemption status unscathed.

Equities

Fixed Income

Liquidity

Economies

.....

Chief Information Officer

Economies

Liquidity

Fixed Income

Equities

Economies

Liquidity

.....

United States

.....

Mortgage-Backed Securities

.....

Commercial mortgage-backed securities

.....

United Kingdom

.....

Gross Domestic Product

.....

Emerging Markets

.....

Emerging Markets

.....

Year to Date

Fixed Income

.....

Gross Domestic Product

.....

Emerging Markets

.....

Silicon Valley Bank

.....

Emerging Markets

.....

United States

.....

Emerging Markets

.....

United States

.....

United States

.....

Year-to-Date

.....

Standard & Poors

.....

Standard & Poor's

.....

Price-to-Earnings

.....

Earnings Per Share

.....

Price-to-Earnings

.....

United States

Equities

.....

United States

.....

United Kingdom

.....

Personal Consumption Expenditures

.....

United Auto Workers

.....

Gross Domestic Product

.....

United States

.....

United States

.....

Federal Open Market Committee

.....

United States

.....

Producer Price Index

.....

European Central Bank

.....

second quarter

US fixed income

International

The Bloomberg Aggregate Global Total Return Bond Index dropped slightly in May to a 5.28% YTD return due to its US component, but ex US markets were broadly positive across developed and emerging markets. The US dollar was again a contributor, posting its fifth consecutive monthly loss and extending its 2025 losses to -7%.

.....

Organization of the Petroleum Exporting Countries

.....

Federal Open Market Committee

.....

Federal Open Market Committee

.....

European Central Bank

.....

International Monetary Fund

.....

European Central Bank

.....

Mortgage-Backed Securities

Fixed income

.....

Union Bank of Switzerland

.....

Investment Grade

.....

Capital Expenditures

.....

Emerging Markets

.....

Morgan Stanley Capital International

.....

Personal Consumption Expenditures

.....

High Yield

.....

Commercial Mortgage-Backed Securities

.....

Artificial Intelligence

Read our Fixed Income committees’ current views and positioning >>

.....

December

.....

United Auto Workers

.....

Overweight

.....

Probability Risk and Impact System

.....

Johnson & Johnson

.....

National Association of Home Builders

.....

National Federation of Independent Business

.....

Organization for Economic Cooperation and Development

.....

Earnings Per Share

.....

Bank of England

.....

United States

.....

Gross Domestic Product

.....

Bank of Japan

.....

Standard & Poor's

.....

Standard & Poor's

.....

United States

.....

Morgan Stanley Capital International

.....

Europe, Australasia, and the Far East

.....

Gross Domestic Product

.....

Purchasing Managers Index

.....

Federal Reserve

.....

fourth quarter

.....

Bank of Japan

.....

Purchasing Managers Index

.....

Quarter on Quarter

.....

Producer Price Index

.....

Consumer Price Index

.....

Kansas City

US stocks reach new highs

.....

Institute of Supply Management

.....

Job Openings and Labor Turnover Survey

.....

Year over year

.....

United Kingdom

.....

United States

.....

Consumer Price Index

.....

Artificial Intelligence

.....

Consumer Price Index

.....

Environmental Impact Assessment

.....

Bank of England

.....

Mortgage Bankers Association

.....

Financial Times Stock Exchange

.....

United States

.....

United States

.....

United States

.....

Gross Domestic Product

.....

Fear of missing out

.....

United States

.....

Federal Open Market Committee

.....

United States

.....

United States

.....

Job Openings and Labor Turnover Survey

.....

United States

.....

National Federation of Independent Business

.....

United Kingdom

.....

United Kingdom

.....

Thousand

.....

Personal Consumption Expenditures

.....

Institute of Supply Management

.....

Mortgage-Backed Securities

.....

National Federation of Independent Business

.....

Leading Economic Index

.....

United States

.....

Federal Reserve

.....

Financial Times Stock Exchange

.....

United States

.....

United States

.....

United States

.....

United States

.....

Group of Seven

.....

Purchasing Managers Index

.....

Artificial intelligence

.....

United States

.....

Standard and Poor's

.....

Republican Party

.....

Standard and Poor's

.....

United Kingdom

.....

Standard and Poor's

.....

Institute of Supply Management

.....

United States

.....

Automatic Data Processing, Inc.

.....

Year to Date

.....

Christian Democratic Union

.....

Bank of England

.....

Bank of America

.....

Emerging Markets Bond Index

.....

United States Dollar

.....

United States

.....

United States

.....

United States

.....

Morgan Stanley Capital International

.....

United States

.....

United States

.....

United States Dollar

.....

Summary Plan Description

.....

Standard & Poor's

.....

United States

.....

Personal Consumption Expenditures

.....

United States

.....

Grand Old Party

.....

United States of America