- 4 hours ago
Markets are near all-time highs despite tariffs, bombings, and the ongoing geopolitical turbulence. The latest round of tariffs from President Trump—targeting imports from over a dozen countries with rates as high as 40%—has so far been met with a muted response from both Asia-Pacific and European equities, with indices like Japan’s Nikkei 225 and South Korea’s Kospi even posting modest gains this week.
This resilience comes despite heightened volatility earlier in the year, when sweeping tariff announcements and reciprocal measures triggered a sharp sell-off and a spike in the VIX index (which measures the volatility of the futures market) to levels not seen since the pandemic. Markets rebounded after a temporary pause and softening of tariff stances, suggesting that investors remain focused on longer-term fundamentals and the potential for quick policy reversals.
At the same time, global events—like unrest in the Middle East and the ongoing war in Ukraine—are still creating uncertainty, especially when it comes to oil prices, which tend to react quickly to headlines. That said, the overall mood has shifted. While investors are still being careful, there’s a bit more optimism in the air than there was a few months ago.
We believe it’s important to stay the course and to get advice before making any important financial decisions. The team here at Trilogy Financial Solutions is always here to help.
OCR Update and what’s next
OCR Update from Adrian
Check out the video below for Adrian’s take on the latest OCR update and what he expects going forward.
With interest rates remaining unchanged, let us know if you'd like any guidance on where to invest your short-term money. We can help you achieve returns of around 3.0% per annum on-call (with daily compounding) and up to 4.25% when investing for 12 months.
These on-call and term deposit options are Portfolio Investment Entity (PIE) products, and tax is capped at 28%. The top tax earners will save up to 11% on tax payments.
If you’re interested in learning more, get in touch by sending an email to info@trilogyfs.co.nz or calling us on 09 553 8928.
The trade war continues

President Trump has ramped up the trade war again, sending out a fresh round of letters to leaders in over 20 countries. He’s warning that steep new tariffs—between 20% and 40%—will kick in on August 1 unless new trade deals are made. This latest move targets countries like Japan, South Korea, the Philippines, Iraq, Algeria, and several others across Asia, Africa, and Eastern Europe.
What this means for you
The ripple effects of these tariffs will impact global trade flows, investor sentiment, and export-driven sectors. This kind of volatility tends to shake markets in the short term, but your diversified portfolios are better positioned to ride out the bumps.
As previously mentioned, the Reserve Bank of New Zealand is keeping a close eye on inflation and may lower interest rates if pressures continue to ease, which could support asset prices but also reduce returns on term deposits.
For now, the best approach is to stay focused on your investment goals, avoid reacting emotionally to headlines, and be assured that we have constructed your portfolio to best suit your situation.
Market update
United States
Major indices are near record highs but showing volatility as investors react to President Trump’s new tariff announcements targeting more than a dozen countries, with rates up to 40% set for 1 August.
The S&P 500 and Dow have seen minor declines over the past few days after recent highs, while the Nasdaq Composite reached a new record close, buoyed by tech sector strength.
Market sentiment remains cautious, with modest gains in futures and an ongoing focus on trade policy uncertainty.
New Zealand
The RBNZ held the OCR at 3.25% on 9 July. The central bank signalled only one more rate cut—likely to 3.00%—before the end of 2025, reflecting ongoing caution about inflation and economic outlook.
The NZX50 index gained 1.6% over the past week and is up 7.5% year-to-date, despite a 0.8% drop on 3 July.
The NZ dollar strengthened after a proposed Israel-Iran ceasefire and dovish signals from the US Federal Reserve, reflecting global risk-on sentiment and a weaker US dollar.
Good news for parents with young children, as the FamilyBoost childcare rebate has been updated. The maximum rebate is now 40% (up from 25%) of weekly early childhood education fees, and the annual household income threshold for eligibility is now $229,000 (up from $180,000).
Australia
The Reserve Bank of Australia (RBA) held the cash rate steady at 3.85% on 8 July, surprising markets that had widely expected a rate cut.
The Australian share market (ASX 200) reached a new record high, gaining around 1% for the week, supported by strength in health, property, resources, and retail sectors. Investor optimism remains strong, with the ASX 200 on track for its 10th gain in 12 weeks, buoyed by expectations of future RBA rate cuts and positive leads from Wall Street.
Asia
Key indices such as Japan’s Nikkei 225 and South Korea’s Kospi have posted modest gains despite being directly targeted by new US tariffs.
Markets across Asia are digesting the potential impact of tariffs but have so far avoided sharp sell-offs, reflecting hopes for further negotiation before the 1 August deadline.
Europe
European markets, including the Stoxx 600 index, also saw slight increases after the US tariff announcements.
Investors are monitoring the situation closely, with European exporters potentially exposed to retaliatory measures and shifts in global trade flows.
Overall, global markets remain near all-time highs but are trading cautiously as the trade war intensifies and the 1st of August tariff deadline approaches.
If you would like to discuss your investment portfolio, retirement planning needs, goals-based investing approach, or any other financial planning matters, please feel free to give our office a call at 09 553 8928 or email us at info@trilogyfs.co.nz.
We are always happy to help.
Sincerely,
The Team at Trilogy Financial Solutions
Disclaimer: The information in this newsletter is accurate at time of writing.