Market Review
As expected, the Fed left rates unchanged following its July meeting. Notably, two Fed members dissented, marking the first time since 1993 that more than one member dissented from a rate decision. Both dissenting members favored a 0.25% rate cut, concerned about slowing economic conditions.
On August 7th, the “final” (but still being negotiated) reciprocal tariffs kicked in for U.S. trading partners. The market has mostly shrugged off the continuous announcements on tariff related exemptions, add-ons, exceptions, deals, etc. by the Trump Administration as they continue to negotiate with countries individually.
Expectations are for Fed Chair Jay Powell to go ahead with a 0.25% rate cut in September, but a lot can change in the economy between now and then. He and the rest of the Fed need clarity on whether tariffs will slow economic activity, fuel inflation, or pass by with little effect.
The most recent inflation reading showed consumer prices rose 2.7% in June from a year earlier. That was faster than May’s increase of 2.4%, and a sign that tariffs are boosting prices of some goods but not significantly. Many U.S. based companies have absorbed tariff related costs or stockpiled goods before the tariffs went into effect. Time will eventually pull out these extra costs out onto U.S consumers.
The U.S. government has collected about $127 billion in tariff revenue so far this year from importers, about $72 billion more than it had at this point last year, according to the Penn Wharton Budget Model. Unfortunately, this extra income will be more than depleted by the tax cost of the OBBB.
On August 1st, following weak employment data, President Trump unexpectedly fired the head of the Bureau of Labor Statistics, the government agency responsible for calculating data related to employment, price changes, and productivity, saying the data was “rigged”. Markets reacted negatively to the news initially but quickly rebounded.
July was another positive month across the board for markets and apart from Small Cap stocks, all asset class returns are positive for 2025 with International Developed (18.25%) and Emerging Markets (17.90%) leading the way. Diversification continues to show its worth in 2025.
High yield savings and money market fund yields continue to hover between 3.5% and 4.2%, where they have been for much of the year. If you are sitting on large amounts of cash, it makes sense to research opportunities for higher yielding accounts. Don’t keep it in accounts earning 0.01% interest!
Closing Thoughts
Retirement can be an occasion for introducing yourself to new mentally and physically engaging routines. But making the pivot from working every day to suddenly not working can be a challenge. Like anything else in life, it takes planning. As was mentioned above, we’re hosting a webinar in August with Dr. Riley Moynes, who has a TED Talk on the 4 Phases of Retirement that has been viewed more than 3.5 million times. Dr. Moynes helps people navigate their way to a sense of purpose in retirement which will ultimately lead to experiencing less age-related cognitive decline. Whether you are in retirement now or approaching retirement, we hope you can join us for this discussion with Dr. Moynes.
The following table summarizes the performance of major asset classes through 07/31/2025:
Note: Return data obtained from Dimensional Fund Advisors database. Returns include dividends and reinvestments.
Regards,
The Milestone Team
Reminders
Please contact us if your financial goals or circumstances have changed or if we can address your needs. Also, please let us know as soon as possible about any change to your contact information.
SEC regulations require us to remind you to compare our reports with the statements provided by the independent custodian that holds your accounts (Fidelity). Please let us know if there are any discrepancies, or if you are not receiving separate statements (or notification of their online availability) directly from the custodian. Please remember that past performance does not predict future results.
Disclaimer: This is not to be considered investment, tax, or financial advice. Please review your personal situation with your tax and/or financial advisor. Milestone Financial Planning, LLC (Milestone) is a fee-only financial planning firm and registered investment advisor in Bedford, NH. Milestone works with clients on a long-term, ongoing basis. Our fees are based on the assets that we manage and may include an annual financial planning subscription fee. Clients receive financial planning, tax planning, retirement planning, and investment management services and have unlimited access to our advisors. We receive no commissions or referral fees. We put our client’s interests first. If you need assistance with your investments or financial planning, please reach out to one of our fee-only advisors. Advisory services are only offered to clients or prospective clients where Milestone and its representatives are properly licensed or exempt from licensure. Past performance shown is not indicative of future results, which could differ substantially.
Market Review
As expected, the Fed left rates unchanged following its July meeting. Notably, two Fed members dissented, marking the first time since 1993 that more than one member dissented from a rate decision. Both dissenting members favored a 0.25% rate cut, concerned about slowing economic conditions.
On August 7th, the “final” (but still being negotiated) reciprocal tariffs kicked in for U.S. trading partners. The market has mostly shrugged off the continuous announcements on tariff related exemptions, add-ons, exceptions, deals, etc. by the Trump Administration as they continue to negotiate with countries individually.
Expectations are for Fed Chair Jay Powell to go ahead with a 0.25% rate cut in September, but a lot can change in the economy between now and then. He and the rest of the Fed need clarity on whether tariffs will slow economic activity, fuel inflation, or pass by with little effect.
The most recent inflation reading showed consumer prices rose 2.7% in June from a year earlier. That was faster than May’s increase of 2.4%, and a sign that tariffs are boosting prices of some goods but not significantly. Many U.S. based companies have absorbed tariff related costs or stockpiled goods before the tariffs went into effect. Time will eventually pull out these extra costs out onto U.S consumers.
The U.S. government has collected about $127 billion in tariff revenue so far this year from importers, about $72 billion more than it had at this point last year, according to the Penn Wharton Budget Model. Unfortunately, this extra income will be more than depleted by the tax cost of the OBBB.
On August 1st, following weak employment data, President Trump unexpectedly fired the head of the Bureau of Labor Statistics, the government agency responsible for calculating data related to employment, price changes, and productivity, saying the data was “rigged”. Markets reacted negatively to the news initially but quickly rebounded.
July was another positive month across the board for markets and apart from Small Cap stocks, all asset class returns are positive for 2025 with International Developed (18.25%) and Emerging Markets (17.90%) leading the way. Diversification continues to show its worth in 2025.
High yield savings and money market fund yields continue to hover between 3.5% and 4.2%, where they have been for much of the year. If you are sitting on large amounts of cash, it makes sense to research opportunities for higher yielding accounts. Don’t keep it in accounts earning 0.01% interest!
Closing Thoughts
Retirement can be an occasion for introducing yourself to new mentally and physically engaging routines. But making the pivot from working every day to suddenly not working can be a challenge. Like anything else in life, it takes planning. As was mentioned above, we’re hosting a webinar in August with Dr. Riley Moynes, who has a TED Talk on the 4 Phases of Retirement that has been viewed more than 3.5 million times. Dr. Moynes helps people navigate their way to a sense of purpose in retirement which will ultimately lead to experiencing less age-related cognitive decline. Whether you are in retirement now or approaching retirement, we hope you can join us for this discussion with Dr. Moynes.
The following table summarizes the performance of major asset classes through 07/31/2025:
Note: Return data obtained from Dimensional Fund Advisors database. Returns include dividends and reinvestments.
Regards,
The Milestone Team
Reminders
Please contact us if your financial goals or circumstances have changed or if we can address your needs. Also, please let us know as soon as possible about any change to your contact information.
SEC regulations require us to remind you to compare our reports with the statements provided by the independent custodian that holds your accounts (Fidelity). Please let us know if there are any discrepancies, or if you are not receiving separate statements (or notification of their online availability) directly from the custodian. Please remember that past performance does not predict future results.
Disclaimer: This is not to be considered investment, tax, or financial advice. Please review your personal situation with your tax and/or financial advisor. Milestone Financial Planning, LLC (Milestone) is a fee-only financial planning firm and registered investment advisor in Bedford, NH. Milestone works with clients on a long-term, ongoing basis. Our fees are based on the assets that we manage and may include an annual financial planning subscription fee. Clients receive financial planning, tax planning, retirement planning, and investment management services and have unlimited access to our advisors. We receive no commissions or referral fees. We put our client’s interests first. If you need assistance with your investments or financial planning, please reach out to one of our fee-only advisors. Advisory services are only offered to clients or prospective clients where Milestone and its representatives are properly licensed or exempt from licensure. Past performance shown is not indicative of future results, which could differ substantially.
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