Is This the New Market Normal? What Trump’s First 6 Months Mean for Global Investors

As the dust settles on the first six months of Donald Trump’s second term, global markets are still struggling to find their footing. What began with the so-called "Trump Trade" — a wave of optimism fuelled by promises of economic nationalism and deregulation — has since evolved into a high-stakes environment marked by executive orders, fiscal upheaval, and a sharp policy pivot on trade, digital assets, and monetary pressure. 

At EBC Financial Group, we’re observing what feels less like a phase and more like a fundamental shift in the mechanics of the global economy. Investors, businesses, and institutions are now operating in a landscape shaped by swift policy swings, unconventional leadership, and political unpredictability. The question isn’t just how we got here — it’s whether this kind of volatility is now the default setting for markets. 

A New Tariff Era: Protectionism Reloaded 

One of the earliest signs of this shift came in April with the introduction of the “Liberation Day” tariffs. After a brief delay that sparked a short-lived market rally, President Trump confirmed the plan’s rollout — catching investors off guard once again. 

The structure of the tariff regime is aggressive. A baseline 10 percent duty applies broadly, while a series of targeted measures have raised more concern: tariffs of 25 to 40 percent on imports from South Africa, Malaysia, and Thailand; a 50 percent duty on copper; and a 40 percent surcharge on goods transhipped through Vietnam. 

While trade deals have been secured with the UK and Vietnam, negotiations with the EU, China, and Canada remain unresolved. The expiry of the 90-day pause period now means full enforcement from 1 August, with no extensions. 

As our CEO of EBC Financial Group (UK) Ltd., David Barrett, puts it: 

"Markets are responding to a single decision-maker controlling tariff policy. That makes the environment more uncertain than usual, as the economic impact depends not only on policy details but on the next political impulse. We are not just seeing supply chain adjustments; we are witnessing a reshaping of global trade flows." 

Economic Data: Stability on the Surface, Tension Beneath 

Headline indicators paint a mixed picture. Inflation has cooled slightly — down from 3 percent in January to 2.4 percent by mid-year — but growth is faltering. US GDP shrank by an annualised 0.5 percent in Q1, the first contraction in three years. Analysts attribute this in part to a pre-tariff inventory build-up and surging imports, but weakening consumer spending and sluggish housing figures suggest deeper cracks. 

Job numbers have bounced around. Federal employment was hit hard in May, with 22,000 roles eliminated under the Trump administration’s “efficiency drive.” But June’s non-farm payrolls surprised to the upside: 147,000 new jobs added, exceeding forecasts of 110,000, and pushing unemployment down to 4.1 percent from 4.2 percent. 

Still, resilience in the labour market hasn’t translated into confidence. 

"On the surface, economic indicators seem manageable, but they are not telling the full story," Barrett noted. "Retail sales have softened, construction activity is lagging, and consumer sentiment is visibly deteriorating. The question now is whether this is the start of a cyclical slowdown or something more structural." 

Fiscal Firepower and Political Trade-Offs 

Trump’s signature legislative win this term came in the form of the 900-page ‘Big Beautiful Bill’, passed in June. It extends the 2017 tax cuts permanently, introduces targeted tax credits, cuts Medicaid spending, and boosts funding for defence and border control. 

The bill also raised the debt ceiling by a massive $5 trillion, giving the Treasury the ability to avoid an imminent shutdown — but at the cost of ballooning government borrowing. 

Markets responded cautiously. On one hand, clarity on tax policy and averted fiscal crisis reassured investors. On the other, the increased pressure on long-term public finances remains a red flag. 

"The US has bought itself time, but at the cost of greater fiscal pressure," Barrett said. "For markets, all eyes are watching if these policies can drive real productivity and growth or whether they merely delay the reckoning." 

Fed Under Pressure: Political Push Meets Policy Patience 

One of the more delicate balances of this presidency has been the growing tension between the Trump administration and the Federal Reserve. Trump has repeatedly urged the Fed to cut interest rates. Chair Jerome Powell, however, has so far resisted — arguing that inflation risks must still be monitored carefully. 

The dollar has weakened steadily since March, fuelled by concerns over rising debt and trade-related slowdowns. Meanwhile, 10-year Treasury yields, which had jumped to 4.8 percent earlier in the year, now trade in a 4.0 to 4.6 percent range, recently hovering around 4.4 percent. 

The Fed’s next move remains uncertain. 

"Inflation has eased for now, but the full effects of tariffs have yet to be priced in," Barrett noted. "If costs rise further and corporate margins shrink, we could see a scenario where the Fed faces both political pressures to cut and economic pressure to hold steady. That's a difficult line to walk." 

Crypto Comes into Focus — With Controversy 

In a move few predicted, the Trump administration has taken a bold stance on crypto. In March, the White House announced the creation of a strategic bitcoin reserve. Shortly after, it introduced the official Trump memecoin, $TRUMP. 

While the coin has surged in value, its political associations have triggered debate over ethics and regulation. 

The Securities and Exchange Commission (SEC) has since launched a task force to establish clearer rules for digital assets. Meanwhile, Trump’s inclusion of pro-Web3 figures in policy circles has raised expectations of regulatory easing in the near term. 

"There's a risk that crypto's credibility is undermined by political branding," said Barrett. "For the industry to mature, it urgently needs regulatory clarity." 

Global Reactions and the UK Outlook 

The effects of Trump’s second-term agenda aren’t limited to the US. In the UK, we’re seeing both potential opportunities and new risks. 

Reduced US–China trade opens space for UK exporters, especially in sectors where tariffs make American and Chinese products less competitive. However, energy prices and customs complexity are on the rise, pressuring manufacturers and importers alike. 

"Protectionism always comes with winners and losers," Barrett explained. "The challenge is to assess exposure, act decisively, and stay ahead of shifting global demand." 

Looking Ahead: Adaptation Over Assumption 

The Federal Reserve now forecasts US GDP growth at just 1.4 percent in 2025, down from 2.4 percent in 2024. And while inflation and unemployment remain relatively stable for now, the compounding effects of tariffs, spending expansion, crypto regulation, and interest rate uncertainty continue to keep markets on edge. 

Yet despite this, many investors remain cautiously hopeful. Earnings have held up better than expected, and the employment picture has not yet broken down. 

At EBC, we believe agility is more important than ever. 

"This is not a moment for complacency," Barrett concluded. "Investors must remain vigilant. We are entering an era of policy-driven markets, where one executive order can reshape the global playing field overnight."