Market Volatility Dips, But Trade War Fears Loom
The markets have been oddly quiet lately. QCP Capital, a firm that tracks crypto and macro trends, pointed out in a recent update that volatility has dropped—partly because geopolitical shocks, like the Israel-Iran tensions, aren’t rattling investors as much as they used to. But beneath the calm, there’s something else brewing. The trade war risks might be creeping back.
The Fed held interest rates steady this time, which wasn’t a surprise. What stood out, though, was their tone—still hawkish, still worried about inflation sticking around. They’re playing the waiting game, watching the numbers before making any moves. And then there’s the trade stuff. Tariffs keep coming up as a potential problem, but for now, the markets aren’t reacting much. Maybe they’re numb to it. Or maybe they just don’t see it coming.
Key Dates to Watch
QCP flagged a few dates that could shake things up. On July 14, the EU might start hitting back with its own tariffs on US goods. Then, in August, two big deadlines hit: the end of the China-US 90-day tariff truce on the 12th, and the expiration of long-term exemptions for Chinese imports on the 31st.
These could cause some short-term dips in risk assets—stocks, crypto, anything that thrives on optimism. But QCP’s main take is surprisingly hopeful. They think China and the US have enough shared interests to eventually work things out. If that happens, it could even give markets a boost.
Why Isn’t the Market Reacting Yet?
It’s strange, really. The EU’s tariff suspension against the US ends soon, and so far, only one trade deal has been struck out of nearly 200 possible ones. Negotiations are stuck. Yet, when bits of bad news leak, the markets barely flinch. Maybe it’s fatigue. Or maybe everyone’s just assuming it’ll get resolved before things spiral.
Still, hedging hasn’t gone away. Investors are keeping some protection in place, bracing for a possible correction. QCP’s view is cautious but not doom-and-gloom—they’re betting on stability winning out in the end.
Of course, none of this is advice. Just a snapshot of where things stand. The quiet might not last.
