The Fed chairman is now leaving the door open to an interest rate cut. Regardless of the real reasons, President Trump will be able to claim victory following the pressure he exerted and ultimately boast: ‘In the end, it’s always Donald Trump who decides!’ All he has to do is wait long enough. This decision sent the markets soaring. Emerging markets, led by China, are driving the movement. The choice of style (small vs large, value vs growth) is not important this year; it is sector selection that makes the difference.

Interest rates have remained within a relatively narrow range since the beginning of the year, leading to relatively poor bond performance. Swiss real estate is performing well in a very low interest rate environment. The USD is under pressure in anticipation of rate cuts, allowing gold and precious metals to continue their strong year.

The risk indicator remains low in August, as do all sub-indices except commodities.