US Household Net Worth Rebounds To Record High In Second Quarter, Fed Data Shows

Economic

Summary:

U.S. household wealth rose to a record $176.3 trillion in the second quarter on the back of a resurgent stock market and climbing property prices, data from the Federal Reserve showed on Thursday.

Household net worth climbed by more than $7 trillion in the April-through-June period thanks mostly to a $5.5 trillion increase in the value of stock market holdings, the Fed said. After slumping to start the year on worries that President Donald Trump's tariffs would torpedo economic growth and stoke inflation, stocks roared back after Trump tempered his approach somewhat and delayed the onset of his proposed import taxes. The benchmark S&P 500 index gained 10.6% in the period.

A $1.2 trillion increase in real estate values also contributed to the rise in wealth, Fed data showed.

Source: Yahoo Finance

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Central Bank

Economic

Major central bank meeting schedule

The upcoming weeks are packed with important economic events as the major central banks hold their monetary policy meetings. Their decisions will be announced at the following times:

European Central Bank (ECB): 8.15pm (HK time) on Thursday 11 September

Federal Reserve (Fed): 2.00am (HK time) on Thursday 18 September

Bank of England (BoE): 7.00pm (HK time) on Thursday 18 September

Bank of Japan (BoJ): 11.00am (HK time) on Friday 19 September

Traders should prepare for heightened volatility as markets digest policy statements, rate decisions and forward guidance. The coordination of these announcements creates unique trading opportunities but also amplifies risk across global markets.

ECB maintains cautious stance after eight rate cuts

The ECB is expected to maintain its current policy stance following eight interest rates cuts implemented since June 2024. At July's meeting, policymakers opted to pause, citing easing domestic price pressures and moderating wage growth as primary considerations.

Recent economic data reinforces this cautious approach. Eurozone headline inflation registered 2.1% year-on-year in August, while core inflation remained stable. However, the slight increase in headline inflation necessitates vigilance against potential renewed price pressures.

Trade dynamics with the US introduce additional complexity to the ECB's deliberations. Despite reaching a bilateral agreement in July, European exporters now face 15% tariffs on most goods entering US markets, significantly exceeding pre-agreement levels.

The tariff burden affects critical sectors including pharmaceuticals, automotive manufacturing and semiconductor production. Moreover, the agreement's implementation remains contingent upon EU elimination of levies on US industrial goods and provision of preferential agricultural tariffs. European automotive exports face particularly challenging conditions, with tariff rates of 27.5% persisting until EU legislative implementation occurs.

Geopolitical developments surrounding the Russia-Ukraine conflict present additional uncertainty for policymakers. Potential US pressure on the EU to impose tariffs up to 100% on Chinese and Indian imports could strain relationships with key trading partners. Such measures might undermine European efforts to strengthen global trade positioning amid escalating international trade tensions.

Consequently, the ECB is likely to maintain its pause in September, with high probability of unchanged policy through year-end. This measured approach reflects uncertainty surrounding trade policy impacts and inflationary dynamics across the eurozone.

Figure 1: The ECB might have found the right balance after eight cuts

Fed confronts deteriorating employment landscape

Labour market deterioration presents the Federal Open Market Committee (FOMC) with compelling rationale for monetary easing at next week's meeting. August non-farm payrolls additions reached just 22,000, substantially below the 75,000 consensus expectation.

This disappointing figure reduced the three-month average job creation to approximately 29,000 positions. Recent Bureau of Labour Statistics annual benchmark revisions suggest labour market weakening commenced earlier than previously recognised, with average monthly gains nearly halved through March 2025.

Unemployment has escalated to 4.3% in August, marking the highest level since October 2021. This deterioration strengthens arguments for accommodative monetary policy to support economic growth and employment recovery.

Markets anticipate a Fed rate reduction with near certainty, though debate centres on magnitude. A 25 basis point cut appears most probable, barring significantly softer inflation readings than July data suggesting Producer Price Index (PPI) growth of 3.3% and Consumer Price Index (CPI) expansion of 2.7% year-on-year.

Bond futures markets price 66% probability of three or more quarter-point reductions by year-end. This expectation reflects both labour market concerns and broader economic growth uncertainties facing the US economy.

Political pressures on Fed independence add complexity to monetary policy deliberations. The Trump administration has intensified criticism of Fed leadership, including public censure of Chair Powell's timing on rate cuts and controversial dismissal of Governor Lisa Cook over alleged mortgage fraud concerns. White House Chief Economic Adviser Stephen Miran will be facing Senate confirmation proceedings for his Federal Reserve Board position tonight. Meanwhile, Governor Lisa Cook maintains her role pending ongoing legal investigation.

These political dynamics introduce additional considerations beyond traditional economic indicators, potentially complicating the Fed's policy communication and implementation strategies.

Figure 2: US policy rates probabilities

BoE navigates inflation-growth trade-offs

The Bank of England's Monetary Policy Committee (MPC) delivered a 25 basis point rate cut in August, reducing the base rate from 4.25% to 4.00%. The decision required two voting rounds, highlighting significant disagreement among committee members regarding appropriate policy direction.

Policymakers must balance competing pressures as both headline and core inflation accelerated to 3.8% in July. Simultaneously, employment data revealed continued weakness with payrolled employee counts declining consecutively over the past six months, creating conflicting policy signals.

Rising long-term borrowing costs present additional challenges for the central bank's balance sheet normalisation efforts. UK 30-year gilt yields briefly touched 5.72% last week, representing the highest level since 1998.

Market consensus overwhelmingly expects policy rates to remain unchanged at September's meeting. However, year-end expectations remain divided, with probability assessments splitting 40% for cuts versus 60% for no change.

Any surprise dovish shift or accommodative guidance could trigger significant sterling weakness against major currencies. The BoE faces the delicate task of supporting economic growth while preventing inflation expectations from becoming entrenched above target levels.

Figure 3: UK's employment and inflation data

BoJ considers policy normalisation

Japan's economic conditions have improved from the challenging environment faced earlier this year. Core consumer price inflation has moderated from its May peak of 3.7% year-on-year to 3.1% in July across two consecutive months.

Economic growth has demonstrated notable acceleration, with annualised GDP expansion improving from 0.3% in Q1 to 2.2% in Q2. This improvement reflects robust private consumption and capital spending, although the effect from front-loading of export orders ahead of tariff implementations will likely wane next quarter.

These developments provide the Bank of Japan with stronger foundations for considering rate increases during 2025, although the central bank has adopted a cautious approach due to underlying price dynamics. The BoJ emphasises 'underlying inflation' measures have not consistently achieved the 2% objective, despite core inflation remaining above 2% since April 2022. Irrespective of which inflation definition proves more accurate, Japanese consumers face tangible impacts from higher prices as real wages have declined for six consecutive months since February.

Uncertainty surrounding potential US trade policy impacts on Japan's export-dependent economy represents another key consideration. The full consequences of the latest tariff framework remain unclear, creating additional complexity for monetary policy planning.

While the BoJ will likely maintain current rates at next week's meeting, any indication of potential 2025 tightening could provide substantial yen support.

Technical analysis of major currency pairs

EUR/USD demonstrates compelling technical momentum as it approaches horizontal resistance at 1.1795. A decisive breakthrough above this level would provide additional upward momentum for the established trend.

The relative strength index maintains a neutral reading of 52, suggesting scope for continued appreciation from valuation perspectives. Key support levels include the 50-day moving average at 1.1656 and August's low of 1.1391, providing downside protection.

Figure 4: EUR/USD (daily) price chart

GBP/USD continues trading within an ascending channel established in January. Following July's peak near 1.3788, the pair has consolidated within a defined range, testing both support and resistance boundaries.

Recent bounces from the channel's lower boundary at 1.3333 suggest the broader uptrend remains intact. A break above 1.3595 would target July's highs around 1.3788, while failure below 1.3333 would shift focus toward 200-day moving average support at 1.3190.

Figure 5: GBP/USD (daily) price chart

The yen has been on a weakening trajectory since April as political leadership instability and persistent rises in long-term bond yields weighed on the currency. However, the yen steadied as the US dollar weakened ahead of critical inflation data.

USD/JPY faces a critical technical juncture at the 148.8 level. Recent rejection at this point indicates the longer-term bearish trend established in January remains valid, though traders should monitor potential reversal signals.

The pair exhibits an ascending triangle pattern with horizontal resistance at 148.6. A breakthrough above this level would signal reversal of the dollar's bear trend, while support emerges around the 146 area during potential pullback.

Figure 6: USD/JPY (daily) price chart

Market implications and strategic considerations

The central bank decisions will have significant implications across various markets, with the Fed's announcement likely to drive the most substantial global impact. The Fed's policy stance influences dollar strength, US Treasury yields, and risk appetite across international markets.

Bond markets will respond substantially to interest rate decisions and forward guidance communications. Yield curve dynamics may experience significant shifts depending on central bank messaging and revised rate expectations.

Equity markets face mixed signals from policy divergence trends. While accommodative monetary policy typically supports asset valuations, underlying economic weakness that necessitates easing could weigh on investor sentiment.

Commodity markets, particularly precious metals, often benefit from accommodative monetary policy environments. Trading opportunities may develop as real yield dynamics shift across major economies.

Risk management assumes paramount importance during periods of heightened volatility surrounding central bank announcements. Position sizing and stop-loss implementation should reflect increased uncertainty and potential for gap movements.

Source: ig

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Commodity

Bridgewater founder and the firm's former CEO Ray Dalio says gold might be a way to shield investors from unhealthy markets, overburdened with debt.

Dalio warned that as the U.S. spends more to service its debts, this "squeezes out other spending" and builds up as plaque would in a clogged human circulatory system.

"A doctor would warn of a heart attack," he said.

"A well-diversified portfolio would have somewhere between 10% and 15% in the portfolio of gold," said Dalio, who sold his remaining stake in Bridgewater Associates in July and stepped away from the hedge fund he founded.

Gold was uncorrelated with other assets, its value tending to rise during a crisis when other assets fall, Dalio told attendees at a launch event for Abu Dhabi Finance Week, scheduled for December.

With the world "abundant in debt" and with geopolitical tensions rising, investors should question "whose money do you own?" when thinking about how to build a neutral portfolio, said Dalio.

Standard Chartered CEO Bill Winters, who sat on the panel alongside Dalio, said that though market valuations in Europe were not as high as in the United States, the conditions were similar.

"The UK and France are in similar situations but markets have been providing more severe constraints than the U.S.," said Winters.

The S&P 500 and Nasdaq, which are up over 11% and 13%, respectively, so far this year, closed at record highs on Wednesday, as cooler-than-expected inflation data supported expectations the U.S. Federal Reserve will cut interest rates next week.

The pan European stock index was last up just over 8% so far in 2025.

Source: Reuters

Risk Warnings and Disclaimers

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Adam

Cryptocurrency

Block 1: Essential news

Kraken launches tokenized stocks in Europe: towards a new investment model?

Kraken is rolling out its xStocks service to European investors, a few weeks after obtaining its MiCA license from the Central Bank of Ireland. Launched in June, this solution allows investors to invest in more than 60 US stocks and ETFs in tokenized form, with one key advantage: 24-hour access and the ability to store them in a personal wallet. But beware: these assets do not confer voting rights and are not traditional shares. They offer exposure to the price, but without the classic legal attributes. For Kraken, this is another step towards decentralized finance applied to shares, with a strong message: "if you own a share, you should reap all the benefits—not your bank." Food for thought.

The Trump family rakes in $1.3bn thanks to cryptocurrencies

Donald Trump wanted to become the "crypto president"... and he's doing everything he can to make it happen. In just a few weeks, the Trump family has generated $1.3bn from its multiple cryptocurrency-related projects. This financial windfall has reignited accusations of conflicts of interest, even as the White House steps up its support for the sector. World Liberty Financial, WLFI stablecoin, crypto ETF, TRUMP memecoins, American Bitcoin mining company, shared treasury with Crypto.com... the list of projects is growing rapidly. According to Bloomberg, earnings from WLFI and related partnerships already total $670m, while the family now holds more than $5bn in digital assets. At this rate, crypto revenues are rivaling those of the iconic Trump golf clubs.

EasyJet enters the crypto market: introducing EasyBitcoin, the low-cost platform for buying BTC

After bargain airline tickets, here comes low-cost bitcoin. The EasyGroup, owner of EasyJet, unveils EasyBitcoin, a new subsidiary dedicated to the purchase and sale of cryptocurrencies, in partnership with Uphold. The goal: to break the fees of traditional platforms, while riding the crypto wave. "I'm only doing this because Trump's re-election has completely mainstreamed [cryptocurrency]," CEO Stelios Haji-Ioannou told Bloomberg. With a simple interface, ultra-competitive commissions, and a "mainstream" positioning, EasyBitcoin intends to apply the EasyJet formula to the BTC market.

24/7 markets: the SEC and CFTC want to model traditional finance on the crypto model

A small revolution could be in the works. The SEC and CFTC, the two US financial regulators, are considering opening the financial markets 24 hours a day, 7 days a week, similar to the crypto model. This idea is part of a strategic shift driven by Donald Trump, who is pushing for an unprecedented rapprochement between the two institutions. The goal is to modernize Wall Street in the era of global and decentralized markets. But that's not all. The SEC-CFTC duo also wants to relax the framework for prediction markets, perpetual contracts, and even decentralized finance (DeFi), which have been closely monitored until now. Behind this initiative is a regulatory recalibration designed to attract innovation and bring offshore crypto volumes back to U.S. soil. A new era is dawning.

Block 2: Crypto Analysis of the Week

Saylor's strategy breaks down

It all started with Strategy, Michael Saylor's pioneering company, which became the first bitcoin-listed "deposit bank." The idea was simple: raise funds on the stockmarket, buy BTC, and take advantage of the leverage between the rise in the token and the rise in the stock. For months, the mechanism seemed foolproof: Strategy's stock rose from $60 to over $500, buoyed by a wave of political support from Washington.

But for the past month, the house of cards has been faltering. Although the company's stock is still up 15% since January 1, it has fallen 18% since mid-August, reaching its lowest level since April. And with it, a whole host of companies that had copied the model. Some are now worth less than the cryptocurrencies they hold, a market anomaly that is making investors nervous. In other words, the most fragile players are at risk of being swept away.

Collateral damage

In Asia, Japan's Metaplanet, the continent's largest holder of bitcoins, has seen its stock plummet 68% since June. In London, Smarter Web Company lost 70% over the same period.

Some groups have even changed their names and repainted their logos in the orange colors of bitcoin to ride the wave. Even if it means abandoning their original business:

KindlyMD, a healthcare provider listed in New York, preferred to buy BTC. Its share price fell 68% in one month.

In France, Capital B, a former tech player that switched to buying tokens, lost 26%.

Others had only one goal: to go public to raise funds and buy crypto. Alt5 Sigma, a partner of the Trump family in the creation of a "crypto treasury," has already fallen 35% since the announcement of the operation.

The "danger zone" of balance sheets

At the heart of the model is an indicator created by Saylor: mNAV, the ratio between enterprise value (shares + debt – cash) and crypto assets. When this ratio falls below 1, the company is worth less than its crypto holdings. Simply put, mNAV measures the difference between a company's market value and the actual value of its bitcoin reserves.

In other words, mNAV is a bit like the "confidence premium" that the market grants to a company in relation to the real value of its bitcoins. If a company holds $1bn worth of bitcoins, but its market value is $2bn, this means that the market is willing to pay twice as much as the value of its bitcoins alone.Why? Because investors believe that this company will manage its bitcoins well, buy more, or that it has a model that justifies paying more. When mNAV is high, the company can easily raise funds, sell shares, and continue to buy bitcoins. It therefore has a real "competitive advantage" in the market. When the mNAV falls to 1 (or below), the market considers that the company is not worth more than its stack of bitcoins. No one wants to invest anymore, the company can no longer finance itself... and if it has to sell its bitcoins to survive, it fuels the market's decline.

This is already the case for some:

LM Funding America is worth $23.5m on the stockmarket, while its BTC portfolio is estimated at $34m.

Semler Scientific, in the healthcare sector, has an enterprise value of $500m, compared to $557m in bitcoins held.

Is the bubble still alive?

Paradoxically, despite the downturn, fundraising continues. Forward Industries announced $1.65bn in Solana cash, and its stock has soared 71% since the announcement. Eightco, a packaging specialist, has launched Worldcoin, triggering a 3,000% (!) surge in its stock price.

Since January, $73bn has been raised to buy bitcoin, and $38bn for ether, according to Architect Partners. But the mood is less euphoric. Bitcoin has fallen 9% from its peak of $124,000. After the euphoria comes doubt: will "crypto cash" be a sustainable model... or a financial mirage destined to collapse? Everything will depend, most certainly, on the evolution of the bitcoin price in the coming months.

Source: marketscreener

Risk Warnings and Disclaimers

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Golden Gleam

Economic

Commodity

Key Points:

●Gold reaches inflation-adjusted peak, driven by economic concerns.

●Potential rise to $4,000-$5,000 per ounce forecasted.

●Increased central bank buying signals ongoing gold accumulation.

Gold reached a new high of $3,674.27 per ounce in September, surpassing its inflation-adjusted peak from 1980, amidst concerns about U.S. economic stability and dollar weakness.

The rise strengthens gold's role as a hedge against inflation and currency depreciation, influencing investor behavior and potentially impacting related crypto assets like gold-backed tokens.

$3,674.27 Gold Price Hits Historic High, Global Reactions Follow

Gold has reached a historic high, with spot prices hitting $3,674.27 per ounce. Central banks, specifically the People’s Bank of China, have boosted holdings due to currency risks. The event emphasizes gold's safe-haven appeal amidst uncertainty in US economic outlook.

The increasing concerns about US economic stability have driven this surge, with anticipated Federal Reserve rate cuts adding to the appeal of gold. The weakening dollar and rising demand for stability are key factors in this development.

"We remain deeply convinced of a continued structural bull case for gold and raise our price targets accordingly," - Natasha Kaneva, Head of Global Commodities Strategy, J.P. Morgan.

Market reaction has been significant, with analysts predicting further gains. Natasha Kaneva from J.P. Morgan highlights continued bullish prospects for gold. Despite no direct statements from major crypto influencers, the indirect effects are apparent as investors seek refuge in stable assets like gold.

Gold Takes Center Stage: Price Data, Historical Peaks, and Analysis

Did you know? In 1980, gold's previous inflation-adjusted peak was $3,590, making the current $3,674.27 an unprecedented high.

PAX Gold (PAXG) is currently priced at $3,635.71, with a market cap of around $1.05 billion as of September 11, 2025, reflecting a minor decrease of 0.26% over 24 hours per CoinMarketCap. Trading volumes have seen a 7.31% change, underscoring gold's bullish trend.

Source: CoinMarketCap

Coincu's research team notes that continued central bank accumulation and geopolitical uncertainty could further bolster gold prices. The potential implications for gold-backed tokens highlight a trend towards diversification and stability, emphasizing gold's role as an enduring store of value.

Source: CryptoSlate

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Risk Warnings and Disclaimers

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Devin

Economic

The International Monetary Fund on Thursday said the Federal Reserve has scope to lower interest rates because of the weakening U.S. labor market, but the central bank should move cautiously with a close eye on emerging economic data.

"Our overall sense is that, given the downside risks to full employment, there is scope for the Fed to begin to lower policy rates," IMF spokeswoman Julie Kozack said in a regular briefing."We also would say that the Fed should proceed cautiously, of course in a data-dependent way, in the coming months."

The Fed is expected to lower its benchmark interest rate by a quarter of a percentage point at a policy meeting next week.

Source: Kitco

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Risk Warnings and Disclaimers

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Adam

Forex

The U.S. dollar has steadied since a record slide earlier this year, but many currency market players still view the greenback as locked in a bearish trend and are bracing themselves for further losses.

The dollar index fell about 11% in the six months through June in one of its steepest declines on record.

The greenback has steadied in recent weeks along with a sharp pullback in bearish futures bets. As of last week, speculators’ net short dollar position was at $5.7 billion, near the smallest since mid-April. That was down sharply from about $21 billion in late June, CFTC data show.

Many investors view this as a pause in the selling rather than a reversal. Worries include twin U.S. fiscal and trade deficits, chances that a slow job market may prompt more aggressive rate cuts from the Federal Reserve and the view that global fund managers may be in the process of rethinking their FX hedging practices as they look to reduce their exposure to the U.S. dollar.

"The dollar is in the process of declining, and there's more to go," Francesca Fornasari, head of currency solutions at Insight Investment said.

"It's messy and it's probably going to be pretty noisy," Fornasari said.

Many of the forces that drove the dollar’s slide remain in place. These include a rethink of U.S. exceptionalism, worries about economic growth due to U.S. President Donald Trump's protectionist trade stance, and persistent twin-deficit concerns.

Soft jobs data give the Fed scope to cut rates more aggressively. This would erode the yield advantage for the greenback.

"The markets are now starting to think about the degree to which the U.S. economy is going to weaken ...how weak will the labor market get going forward and what does that mean for Fed monetary policy," said Paresh Upadhyaya, director of fixed income and currency strategy at Amundi, the biggest European asset manager.

The Fed will likely resume cutting short-term rates next week and continue on for the rest of the year.

Upadhyaya, who started the year bearish on the greenback and has been adding to short dollar positions, sees little reason to change course now.

GLOBAL INVESTORS FACE HEDGING HEADACHE

Years of U.S. outperformance have left global investors heavily exposed to American assets. April’s tariff turbulence prompted some to trim positions and reassess hedges, but the repositioning is far from complete, investors said.

With foreign holdings of U.S. assets in the trillions, according to banks including Deutsche Bank, any paring of exposure could weigh on the dollar, a move that has yet to materialize in a big way, analysts said.

"The next big drop in the dollar could be if foreign investors decide they want to now start reducing their U.S. allocation," Amundi's Upadhyaya said.

The dollar's dismal first-half performance has already prompted a pick-up in hedging activity by asset managers. Slower-acting market participants could join the fray over the next three to six months, Insight Investment's Fornasari said.

Hedging flows typically involve selling dollars via forwards or swaps, adding supply that can pressure the greenback. Lower U.S. interest rates relative to overseas rates reduce the cost of popular hedging instruments and can make hedging more attractive.

"It is stating the obvious that additional Fed cuts from here would increase incentives to hedge dollar assets by foreign investors," George Saravelos, Global Head of FX Research at Deutsche Bank, said in a note on Monday.

Dollar bulls are unlikely to find support from the Trump administration, investors said, as the “America First” agenda and plans to revive U.S. manufacturing work against a stronger currency. The administration has occasionally said it is committed to protecting the strength and power of the U.S. dollar.

"They still believe in a strong dollar, king dollar, but a little bit weaker than the very elevated level (at the start of the year,)" Thanos Bardas, managing director and co-head of global investment-grade fixed income at Neuberger Berman, said.

"There is no way they can bring manufacturing back to the U.S. with the dollar index at 110," said Bardas, who expects the index to linger in the 95 to 100 range in the near term. On Wednesday the index was at 97.72.

"I don't think the U.S. wants to necessarily signal its desire for a weaker dollar, but it's not going to stand in the way of a weaker dollar," said Shaun Osborne, chief FX strategist at Scotiabank. Osborne sees the dollar falling another 5% to 7% over the next year or so against major peers.

MANY SAY DOLLAR IS STILL OVERVALUED

There is still some chance that the dollar finds some support, given how much it has already fallen this year and the extent of Fed easing already priced in by the market.

One risk to the weaker-dollar view is an unexpected brightening in the U.S. economic growth outlook, Neuberger Berman’s Bardas said.

The economy expanded faster than first estimated in the second quarter, helped by business investment in intellectual property such as artificial intelligence, though import tariffs kept the outlook cloudy.

Still, the dollar remains expensive relative to many currencies, investors said, discouraging potential buyers in FX markets, known for prolonged periods where currencies overshoot in both directions.

"We're just barely getting to what I would consider neutral levels for the dollar," Amundi's Upadhyaya said, noting that the dollar is far from undervalued.

"We have more of the dollar bear market still to come."