Trade Wars and Inflation: What’s Next for U.S. Economic Policy?

Hope you're having a great Sunday! ☕📈 

Here’s your weekly market recap, bringing you the biggest updates in stocks, crypto, and the economy—quick, clear, and to the point.

Stock Market

Stocks Headlines

$HOOD ( ▲ 2.7% ) : Massachusetts regulators are investigating Robinhood over its new March Madness betting feature, which lets users predict basketball tournament outcomes. The probe examines whether the platform is violating state gambling laws. Robinhood, primarily known for stock trading, recently expanded into prediction markets, blurring the lines between investing and gambling. This scrutiny comes amid growing concerns over financial platforms engaging in betting-like activities.

$XOM ( ▼ 0.06% ) : ExxonMobil is investing $100 million in a new facility to produce high-purity isopropyl alcohol (IPA), a key cleaning agent for the semiconductor industry. The investment aims to strengthen supply chains amid growing chip demand. The facility, located in Baton Rouge, Louisiana, will enhance U.S. production capacity and support the tech sector’s need for ultra-clean materials. This move aligns with broader efforts to boost domestic semiconductor manufacturing and reduce reliance on foreign suppliers.

Discord is reportedly preparing for a major IPO, positioning itself as a key player in the tech industry. The company, known for its gaming-focused communication platform, has expanded its reach beyond gaming into broader online communities. With strong revenue growth and a large user base, investors are watching closely as Discord finalizes its path to going public.

Elon Musk’s AI company, xAI, has acquired X (formerly Twitter) in an all-stock deal, valuing xAI at $80 billion and X at $33 billion, including $12 billion in debt. Musk aims to integrate xAI’s AI capabilities with X’s platform to enhance user experiences and expand its reach. This move follows Musk's vision of X as a “digital town square” and his broader ambitions for AI-driven platforms.

Spotlight

NASA's James Webb Space Telescope has captured the auroras on Neptune for the first time, marking a significant achievement in space exploration. The telescope’s advanced instruments revealed stunning images of these northern lights-like phenomena on the distant planet, expanding our understanding of Neptune’s atmospheric dynamics.

Crypto

Crypto Radar

Intercontinental Exchange (ICE) and Circle have signed an MoU to explore using Circle’s stablecoins, USDC and USYC, in new financial products. ICE, which owns the NYSE, sees potential in stablecoins for capital markets. The partnership aims to integrate digital assets into ICE’s markets, including derivatives and clearinghouses. Circle’s USDC, a fully reserved stablecoin, has over $60 billion in circulation. This collaboration could expand the role of stablecoins in institutional finance.

Fidelity is developing a stablecoin and tokenized fund, signaling its deeper push into blockchain-based financial products. The move aligns with growing institutional interest in digital assets and tokenization to enhance liquidity and accessibility in traditional finance. While details are limited, this development could position Fidelity as a major player in the emerging tokenized finance space.

BlackRock has launched its first Bitcoin exchange-traded product (ETP) in Europe, expanding its crypto offerings beyond the U.S. The iShares Bitcoin ETP is domiciled in Switzerland and listed in Paris, Amsterdam, and Frankfurt. BlackRock, which previously introduced spot Bitcoin ETFs in the U.S., partnered with Coinbase as custodian and BNY Mellon as administrator. The move comes as institutional interest in cryptocurrency continues to grow.

Economy

Economic News

President Trump is pushing for a more aggressive tariff strategy, urging advisers to escalate trade measures ahead of April 2nd. Despite opposition from Wall Street and Capitol Hill, he remains focused on increasing tariffs to reshape the U.S. economy. Trump has revisited the idea of a universal tariff that would apply to most imports, emphasizing its potential benefits for U.S. manufacturing and government revenue. His administration is expected to announce reciprocal levies in early April.

The PCE inflation data for February 2025 shows a moderate increase in consumer prices, aligning with the Federal Reserve's efforts to control inflation. The core PCE index, which excludes food and energy, rose by 4.3% year-over-year. The Fed's goal of keeping inflation around 2% remains a challenge, impacting future monetary policy decisions.

The UK’s growth forecast for 2025 has been halved from 2% to 1%, according to the Office for Budget Responsibility (OBR). However, growth projections for subsequent years have been upgraded. The chancellor highlighted potential for a fiscal surplus by 2029 and emphasized the government's focus on long-term economic reforms, including pension changes and national wealth funds. Unemployment is expected to rise, and inflation is forecasted to reach 3.8% in July 2025, largely due to energy and food costs. Further cuts to welfare are planned as well.

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Disclaimer:
We are not financial advisors, and the information provided in this newsletter is for educational purposes only. Always conduct your own due diligence and consider what makes sense for your individual financial situation. Investing involves risks, and there is no guarantee of making money. In fact, you may lose money. We aim to provide you with the tools and insights to help you make informed decisions, but the ultimate responsibility lies with you.