The Lowdown

This week, President Trump and UK Prime Minister Keir Starmer unveiled a US-UK trade deal—the first since steep tariffs were imposed in April. The agreement slashes tariffs on UK steel and aluminium to 0%, cuts car tariffs 27.5% to 10% for up to 100,000 vehicles, and expands US tariff-free access to British agricultural markets. 

The agreement is expected to generate US$6 billion in new tariff revenue for the US Treasury.

Meanwhile, the Federal Reserve left interest rates unchanged at 4.25%–4.5% during its May meeting, citing economic uncertainty from global trade disruptions. It continues to hold a cautious stance and a “wait and see” approach.

So, while the deal offers sector-specific relief, ongoing tariff volatility could continue to pressure inflation and employment.

What This Means For You

The US-UK trade deal signals near-term gains for sectors like autos, steel, and agriculture. The trade deal provides relief to sectors like the UK’s automotive and steel industries, while offering US farmers expanded export opportunities. 

However, the agreement’s limited scope and the ongoing 10% baseline tariff on British goods suggest that broader trade tensions persist. The Federal Reserve’s decision to maintain interest rates at 4.25%–4.5% amid economic uncertainties also indicates a cautious approach to monetary policy.

For investors, this means staying diversified is critical.

Build an Equity-Bond Mix for a Volatile Market

Investors may consider diversifying their portfolios through Syfe’s Core Equity100 and Income+ portfolios. 

Core Equity100 offers exposure to a diversified global equity portfolio, potentially benefiting from sectors poised to capitalise on trade agreements. Our Smart Beta strategy optimises your portfolio’s equity component to outperform the markets over time.

Source: Syfe research, as of 31 March 2025. Past returns are not a guarantee for future performance.

Income+ is a global bond portfolio, offering stability and income in a fluctuating interest rate landscape. Regular portfolio reviews and adjustments are made based on PIMCO’s insights and forward guidance, and the portfolio offers a monthly payout of 5.0%-6.0%.