Expect 50 Bps Cut in December: Watt

Bloomberg Surveillance on September 12, 2025, reported that a framework deal has been reached to allow TikTok to continue operating in the U.S. The broadcast also featured discussions indicating that tariff issues extend beyond China, as noted by Narayan, and former Fed President William Dudley's assessment that the likelihood of one or two Federal Reserve rate cuts after September remains a 'close call'.

Analysis

The market is processing a mix of resolved geopolitical risk and persistent macroeconomic uncertainty. A framework agreement securing TikTok's continued U.S. operations marks a significant de-escalation in a key regulatory and geopolitical flashpoint, removing a major overhang for the technology sector and altering the competitive landscape. Concurrently, commentary from former Fed President William Dudley, describing the path for one or two rate cuts after September as a 'close call,' underscores the ongoing ambiguity in monetary policy. This uncertainty suggests market sentiment will remain highly sensitive to incoming economic data. Furthermore, the note that tariff policy is expanding beyond a singular focus on China indicates a broadening of trade friction risks, requiring a more global view of supply chain vulnerabilities and potential impacts on corporate costs.

Key Decisions for Investors

• Re-evaluate positions in the social media and digital advertising space, as the resolution of TikTok's U.S. operational status alters the competitive environment for its U.S.-based peers.
• Given the uncertainty surrounding the number of Fed rate cuts, consider maintaining a balanced exposure to rate-sensitive assets and prepare for potential volatility around key economic data releases that could influence the Fed's decision.
• Investors should review portfolio exposure to companies with global supply chains, as the indication of broader tariff discussions beyond China introduces new, multi-regional geopolitical trade risks.