🔔Top Client Questions: Middle East Conflict, China Trade Deal, and Inflation💡
Staying Focused Amid Global Uncertainty
We understand that the recent conflict in the Middle East, along with ongoing global trade headlines, may be causing concern. Geopolitical and economic events can create uncertainty in the markets, and it’s natural to have questions during times like these.
Please know that we are closely monitoring the situation and its potential impact on your financial plan. Our team remains focused on long-term strategy, not short-term noise, and we’re here to help you stay grounded through turbulent times.
We’ll continue to share timely updates and insights as events develop. In the meantime, don’t hesitate to reach out with any questions or concerns.
Here are some of the top client questions centered around the Middle East conflict, China Trade Deal, and Inflation.
How will geopolitical risk between Israel and Iran affect markets?
The situation is still developing and can change quickly, but here are some key insights:
• Israel’s attack and Iran’s retaliation come after unsuccessful discussions between the U.S. and Iran over reducing Iran’s nuclear capabilities. Perhaps the biggest concern among investors is whether this conflict will escalate further. This is occurring even as the Israel-Gaza war rages on.
• It’s important to keep these conflicts in perspective. While serious from a geopolitical perspective, they are generally not a reason to react with our portfolios. This has been true over the past several years and across history. While markets may demonstrate a “flight-to-safety pattern” over days or weeks, markets have also been resilient over longer time frames.
• Oil markets were immediately impacted with the price of Brent crude surging over 7% following the attack. While regional conflicts do not necessarily affect the broader market, oil prices can act as a transmission mechanism. Higher oil prices affect consumers and businesses all around the world, so disruptions to supply and demand can affect the global economy. That said, the jump in oil only brings prices back to where they were as recently as April.
• Some “safe haven” assets strengthened, with gold prices, the Japanese yen, the Swiss franc, and the U.S. dollar all gaining as investors sought refuge from geopolitical uncertainty. This is consistent with historical patterns during periods of heightened Middle East tensions. The exception is Treasury yields which have increased, suggesting investors are not flocking to these bonds.
The included chart on geopolitics illustrates how markets have navigated various global tensions over time, showing that while short-term volatility is common during uncertain periods, markets have historically maintained their long-term upward trajectory despite major disruptions including wars, financial crises, and energy shocks.
While geopolitical events can create near-term market volatility, maintaining a long-term perspective and staying focused on your financial goals rather than short-term market reactions remains the most prudent approach to building wealth over time.
Have the U.S. and China reached a trade deal?
The situation is still evolving and, despite reports, it’s not yet clear if a final deal has been reached. Here are some key points that may help provide perspective in the meantime:
• On June 11, President Trump announced via social media that a new trade deal had been reached with China. However, it’s not yet clear if and when the deal will be finalized. China has also not confirmed key details of the deal.
• According to reports, this deal includes a 55% tariff by the U.S. on Chinese goods, a 10% tariff by China on U.S. goods, and the restoration of the ability for Chinese students to study at American universities. A key provision of the deal is for China to supply the U.S. with “rare earth metals” that are important for high-tech products.
• While these trade tensions have been the biggest source of market volatility this year, markets also recovered swiftly once initial deals were reached. This underscores the importance of focusing not on the tariffs themselves, but on the desire by the White House to achieve new agreements.
The included chart shows the U.S. trade imbalance with China, the key reason the administration would like to raise tariffs.
What does the latest CPI report tell us about inflation and tariffs?
Consumer price index data is one of the most closely watched economic indicators because it directly affects monetary policy decisions and provides insight into the health of the economy.
Here are some key points from the latest data:
• The Consumer Price Index rose just 0.1% in May, slower than April’s 0.2% increase and below economist expectations. Over the past year, consumer prices rose 2.4% – suggesting price pressures continue to improve gradually.
• Core CPI, which excludes volatile food and energy prices, also rose only 0.1% monthly and 2.8% annually, providing evidence that underlying inflation trends are moving in the right direction.
• A measure called “super core” inflation, which excludes housing costs, has risen just 1.9% over the past year, while the Fed’s preferred PCE measure shows annual inflation at 2.1%, very close to the central bank’s 2% target.
• These recent figures suggest that inflation continues to improve. There are also no clear signs that tariffs have made their way into these consumer inflation figures just yet.
• The market still expects the Fed to cut rates possibly twice later this year. These inflation trends would put them on the path to doing so, although this also depends on the level of political and economic uncertainty.
The included chart shows various inflation measures and how they have evolved over time, demonstrating that multiple indicators are converging toward the Fed’s target range after the significant price increases of recent years.
While these encouraging inflation trends may influence the timing of future Fed policy changes, successful long-term investing focuses on broader economic fundamentals rather than short-term policy adjustments.
As global headlines continue to evolve, we remain committed to providing clarity, context, and guidance. Whether it’s geopolitical tensions, shifting trade policies, or inflation data, our focus is always on how these developments fit into your long-term financial picture. Market noise may change by the day, but your goals—and the disciplined strategies we use to pursue them—remain steady. If you have any concerns or want to revisit your plan, our team is here and ready to support you.
Concerns or questions about how your investment portfolio will hold up in the current market environment? Contact Financial Synergies today.
We are a boutique, financial advisory and total wealth management firm with over 35 years helping clients navigate turbulent markets. To learn more about our approach to investment management please reach out to us. One of our seasoned advisors would be happy to help you build a custom financial plan to help ensure you accomplish your financial goals and objectives. Schedule a conversation with us today.
More relevant articles by Financial Synergies:
Blog Disclosures
This content, which contains security-related opinions and/or information, is provided for informational purposes only and should not be relied upon in any manner as professional advice, or an endorsement of any practices, products or services. There can be no guarantees or assurances that the views expressed here will be applicable for any particular facts or circumstances, and should not be relied upon in any manner. You should consult your own financial advisors as to legal, business, tax, and other related matters concerning any investment.
The commentary in this “post” (including any related blogs, videos, and social media) reflects the personal opinions, viewpoints, and analyses of the Financial Synergies Wealth Advisors, Inc. employees providing such comments, and should not be regarded as the views of Financial Synergies Wealth Advisors, Inc. or its respective affiliates or as a description of advisory services provided by Financial Synergies Wealth Advisors, Inc. or performance returns of any Financial Synergies Wealth Advisors, Inc. client.
Any opinions expressed herein do not constitute or imply endorsement, sponsorship, or recommendation by Financial Synergies Wealth Advisors, Inc. or its employees. The views reflected in the commentary are subject to change at any time without notice.
Nothing on this website constitutes investment or financial planning advice, performance data or any recommendation that any particular security, portfolio of securities, transaction or investment strategy is suitable for any specific person. It also should not be construed as an offer soliciting the purchase or sale of any security mentioned. Nor should it be construed as an offer to provide investment advisory services by Financial Synergies Wealth Advisors, Inc.
Any mention of a particular security and related performance data is not a recommendation to buy or sell that security. Financial Synergies Wealth Advisors, Inc. manages its clients’ accounts using a variety of investment techniques and strategies, which are not necessarily discussed in the commentary. Investments in securities involve the risk of loss. Past performance is no guarantee of future results.
Any charts provided here or on any related Financial Synergies Wealth Advisors, Inc. personnel content outlets are for informational purposes only, and should also not be relied upon when making any investment decision. Any indices referenced for comparison are unmanaged and cannot be invested into directly. As always please remember investing involves risk and possible loss of principal capital; please seek advice from a licensed professional. Any projections, estimates, forecasts, targets, prospects and/or opinions expressed in these materials are subject to change without notice and may differ or be contrary to opinions expressed by others. Information in charts have been obtained from third-party sources and data, and may include those from portfolio securities of funds managed by Financial Synergies Wealth Advisors, Inc. While taken from sources believed to be reliable, Financial Synergies Wealth Advisors, Inc. has not independently verified such information and makes no representations about the enduring accuracy of the information or its appropriateness for a given situation. All content speaks only as of the date indicated.
Financial Synergies Wealth Advisors, Inc. is a registered investment adviser. Advisory services are only offered to clients or prospective clients where Financial Synergies Wealth Advisors, Inc. and its representatives are properly licensed or exempt from licensure. Investments in securities involve the risk of loss. Past performance is no guarantee of future results.
See Full Disclosures Page Here
Top Client Questions: Middle East Conflict, China Trade Deal, and Inflation
🔔Top Client Questions: Middle East Conflict, China Trade Deal, and Inflation💡
Staying Focused Amid Global Uncertainty
We understand that the recent conflict in the Middle East, along with ongoing global trade headlines, may be causing concern. Geopolitical and economic events can create uncertainty in the markets, and it’s natural to have questions during times like these.
Please know that we are closely monitoring the situation and its potential impact on your financial plan. Our team remains focused on long-term strategy, not short-term noise, and we’re here to help you stay grounded through turbulent times.
We’ll continue to share timely updates and insights as events develop. In the meantime, don’t hesitate to reach out with any questions or concerns.
Here are some of the top client questions centered around the Middle East conflict, China Trade Deal, and Inflation.
How will geopolitical risk between Israel and Iran affect markets?
The situation is still developing and can change quickly, but here are some key insights:
• Israel’s attack and Iran’s retaliation come after unsuccessful discussions between the U.S. and Iran over reducing Iran’s nuclear capabilities. Perhaps the biggest concern among investors is whether this conflict will escalate further. This is occurring even as the Israel-Gaza war rages on.
• It’s important to keep these conflicts in perspective. While serious from a geopolitical perspective, they are generally not a reason to react with our portfolios. This has been true over the past several years and across history. While markets may demonstrate a “flight-to-safety pattern” over days or weeks, markets have also been resilient over longer time frames.
• Oil markets were immediately impacted with the price of Brent crude surging over 7% following the attack. While regional conflicts do not necessarily affect the broader market, oil prices can act as a transmission mechanism. Higher oil prices affect consumers and businesses all around the world, so disruptions to supply and demand can affect the global economy. That said, the jump in oil only brings prices back to where they were as recently as April.
• Some “safe haven” assets strengthened, with gold prices, the Japanese yen, the Swiss franc, and the U.S. dollar all gaining as investors sought refuge from geopolitical uncertainty. This is consistent with historical patterns during periods of heightened Middle East tensions. The exception is Treasury yields which have increased, suggesting investors are not flocking to these bonds.
The included chart on geopolitics illustrates how markets have navigated various global tensions over time, showing that while short-term volatility is common during uncertain periods, markets have historically maintained their long-term upward trajectory despite major disruptions including wars, financial crises, and energy shocks.
While geopolitical events can create near-term market volatility, maintaining a long-term perspective and staying focused on your financial goals rather than short-term market reactions remains the most prudent approach to building wealth over time.
Have the U.S. and China reached a trade deal?
The situation is still evolving and, despite reports, it’s not yet clear if a final deal has been reached. Here are some key points that may help provide perspective in the meantime:
• On June 11, President Trump announced via social media that a new trade deal had been reached with China. However, it’s not yet clear if and when the deal will be finalized. China has also not confirmed key details of the deal.
• According to reports, this deal includes a 55% tariff by the U.S. on Chinese goods, a 10% tariff by China on U.S. goods, and the restoration of the ability for Chinese students to study at American universities. A key provision of the deal is for China to supply the U.S. with “rare earth metals” that are important for high-tech products.
• While these trade tensions have been the biggest source of market volatility this year, markets also recovered swiftly once initial deals were reached. This underscores the importance of focusing not on the tariffs themselves, but on the desire by the White House to achieve new agreements.
The included chart shows the U.S. trade imbalance with China, the key reason the administration would like to raise tariffs.
What does the latest CPI report tell us about inflation and tariffs?
Consumer price index data is one of the most closely watched economic indicators because it directly affects monetary policy decisions and provides insight into the health of the economy.
Here are some key points from the latest data:
• The Consumer Price Index rose just 0.1% in May, slower than April’s 0.2% increase and below economist expectations. Over the past year, consumer prices rose 2.4% – suggesting price pressures continue to improve gradually.
• Core CPI, which excludes volatile food and energy prices, also rose only 0.1% monthly and 2.8% annually, providing evidence that underlying inflation trends are moving in the right direction.
• A measure called “super core” inflation, which excludes housing costs, has risen just 1.9% over the past year, while the Fed’s preferred PCE measure shows annual inflation at 2.1%, very close to the central bank’s 2% target.
• These recent figures suggest that inflation continues to improve. There are also no clear signs that tariffs have made their way into these consumer inflation figures just yet.
• The market still expects the Fed to cut rates possibly twice later this year. These inflation trends would put them on the path to doing so, although this also depends on the level of political and economic uncertainty.
The included chart shows various inflation measures and how they have evolved over time, demonstrating that multiple indicators are converging toward the Fed’s target range after the significant price increases of recent years.
While these encouraging inflation trends may influence the timing of future Fed policy changes, successful long-term investing focuses on broader economic fundamentals rather than short-term policy adjustments.
As global headlines continue to evolve, we remain committed to providing clarity, context, and guidance. Whether it’s geopolitical tensions, shifting trade policies, or inflation data, our focus is always on how these developments fit into your long-term financial picture. Market noise may change by the day, but your goals—and the disciplined strategies we use to pursue them—remain steady. If you have any concerns or want to revisit your plan, our team is here and ready to support you.
Concerns or questions about how your investment portfolio will hold up in the current market environment? Contact Financial Synergies today.
We are a boutique, financial advisory and total wealth management firm with over 35 years helping clients navigate turbulent markets. To learn more about our approach to investment management please reach out to us. One of our seasoned advisors would be happy to help you build a custom financial plan to help ensure you accomplish your financial goals and objectives. Schedule a conversation with us today.
More relevant articles by Financial Synergies:
Blog Disclosures
This content, which contains security-related opinions and/or information, is provided for informational purposes only and should not be relied upon in any manner as professional advice, or an endorsement of any practices, products or services. There can be no guarantees or assurances that the views expressed here will be applicable for any particular facts or circumstances, and should not be relied upon in any manner. You should consult your own financial advisors as to legal, business, tax, and other related matters concerning any investment.
The commentary in this “post” (including any related blogs, videos, and social media) reflects the personal opinions, viewpoints, and analyses of the Financial Synergies Wealth Advisors, Inc. employees providing such comments, and should not be regarded as the views of Financial Synergies Wealth Advisors, Inc. or its respective affiliates or as a description of advisory services provided by Financial Synergies Wealth Advisors, Inc. or performance returns of any Financial Synergies Wealth Advisors, Inc. client.
Any opinions expressed herein do not constitute or imply endorsement, sponsorship, or recommendation by Financial Synergies Wealth Advisors, Inc. or its employees. The views reflected in the commentary are subject to change at any time without notice.
Nothing on this website constitutes investment or financial planning advice, performance data or any recommendation that any particular security, portfolio of securities, transaction or investment strategy is suitable for any specific person. It also should not be construed as an offer soliciting the purchase or sale of any security mentioned. Nor should it be construed as an offer to provide investment advisory services by Financial Synergies Wealth Advisors, Inc.
Any mention of a particular security and related performance data is not a recommendation to buy or sell that security. Financial Synergies Wealth Advisors, Inc. manages its clients’ accounts using a variety of investment techniques and strategies, which are not necessarily discussed in the commentary. Investments in securities involve the risk of loss. Past performance is no guarantee of future results.
Any charts provided here or on any related Financial Synergies Wealth Advisors, Inc. personnel content outlets are for informational purposes only, and should also not be relied upon when making any investment decision. Any indices referenced for comparison are unmanaged and cannot be invested into directly. As always please remember investing involves risk and possible loss of principal capital; please seek advice from a licensed professional. Any projections, estimates, forecasts, targets, prospects and/or opinions expressed in these materials are subject to change without notice and may differ or be contrary to opinions expressed by others. Information in charts have been obtained from third-party sources and data, and may include those from portfolio securities of funds managed by Financial Synergies Wealth Advisors, Inc. While taken from sources believed to be reliable, Financial Synergies Wealth Advisors, Inc. has not independently verified such information and makes no representations about the enduring accuracy of the information or its appropriateness for a given situation. All content speaks only as of the date indicated.
Financial Synergies Wealth Advisors, Inc. is a registered investment adviser. Advisory services are only offered to clients or prospective clients where Financial Synergies Wealth Advisors, Inc. and its representatives are properly licensed or exempt from licensure. Investments in securities involve the risk of loss. Past performance is no guarantee of future results.
See Full Disclosures Page Here
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