In a recent interview, UBS Group AG CEO Sergio Ermotti expressed optimism about the U.S. market, despite ongoing tariff uncertainties.
What Happened: Ermotti, during an interview with Fox Business on Mornings With Maria, pointed out the “fantastic opportunity” in the U.S. due to robust wealth creation. “This is the reason why we keep investing in our franchise,” he said. Despite short-term uncertainties, Ermotti remains confident that the U.S. will continue to be a lucrative investment destination.
Ermotti highlighted the need for certainty to drive investment and mitigate risk. He believes that once a decision on tariffs is reached, it will lead to a “new start.”
Over the past few years, Ermotti has noticed a growing demand for diversification, with the U.S. being the reference economy for investment. He cited the liquidity and depth of liquidity in the U.S. as unmatched.
Ermotti also touched on the impact of regulatory adjustments post the financial crisis, expressing UBS’s support for a more accommodating regulatory environment. While welcoming easier regulation, Ermotti noted that the current uncertainty is hindering deal execution. However, he signaled that full certainty on tariffs would enhance the U.S. investing environment.
The UBS CEO concluded by expressing confidence in the U.S., stating that the role of the dollar and the U.S. capital markets will likely continue to be leading ones for the foreseeable future.
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Why It Matters: The U.S. market has been under the cloud of tariff uncertainties, as outlined by senior economist Mohamed El-Erian. The Trump administration’s tariff letters have sparked a high level of uncertainty and volatility, leading to a wait-and-see approach by businesses and investors.
Furthermore, Economist Justin Wolfers has warned that President Donald Trump‘s fixation on low interest rates could set the U.S. on a path similar to the inflation crisis that has gripped Turkey.
Despite these challenges, Ermotti’s confidence in the long-term prospects of the U.S. market reflects the continued appeal of the country as a top investment destination.
Following a knee-jerk reaction upon the announcement of Liberation Day tariffs, the stock markets have now stabilized with the NASDAQ and S&P 500 recording a 4.21% and 3.72% rise, respectively, over the past month.
Invesco QQQ Trust, Series 1 (NASDAQ:QQQ) and Vanguard S&P 500 ETF (NYSE:VOO) climbed 4.13% and 3.47%, respectively, over the last 30 days.
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Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.
