3 Things You Need to Know This Week | US Tariffs, China Politics, Bitcoin (March 3, 2025)

Transcript

Meg Leiken:

Hello, and welcome to 3 Things You Need to Know This Week, our regular series designed to help you sift through the noise across financial media and understand what really matters for markets.

And now, here are three things you need to know this week.

First up, US tariffs.

As a reminder, at Fisher Investments we are politically agnostic and solely assess political developments for their potential market impact. US tariffs on Mexico and Canada are making headlines again as a critical deadline approaches this Tuesday. By the time you watch this, a new deal may already be in place. There may be another delay or tariffs may have gone into effect. Whatever the outcome, we don't think it's likely to be a major market disrupter—and here's why: This tariff deadline has been widely known for some time, giving markets and companies the opportunity to digest and adjust. If tariffs are ultimately implemented, that could affect some specific companies and products. But as we've discussed before, companies are generally pretty good about adjusting to tariffs to preserve their profits, which should help mitigate the impact.

Also on Tuesday, President Trump will deliver his first congressional address, which may provide more insight into his trade policies. Throughout his first term, Trump frequently used tariffs as a negotiating tool to achieve his policy objectives, and this just seems like more of the same. We'll keep monitoring trade policy developments, but at this point, we believe that discussions surrounding tariffs are generally more talk than action.

Next, China's annual government meetings.

On Tuesday and Wednesday, the Chinese government kicks off its annual government meetings, called the two sessions, typically held each March. These sessions are critical and set the stage for major policy decisions on the economy, trade and even the military. Among the key announcements expected—China's economic growth target for 2025, along with potential new measures to stimulate the economy.

Sentiment toward China has been weak. News coverage often zeroes in on China's long-term problems or the risk of another US-China trade war. However, past tariffs didn't cause major global disruption. They mostly redirected trade through other countries. Also, despite facing challenges like a struggling real estate sector and rising international tensions, China's economy grew by 5.4% in the last quarter of 2024, compared to the year prior. Outside of real estate, China's industries are rebounding and consumer activity is actually much stronger than many may expect. Looking ahead, we believe China's economy will continue to play a key role in supporting global growth this year.

Finally, Bitcoin.

As the 2024 presidential election approached, there was plenty of buzz about how a second Trump term might impact industries like cryptocurrency. Many expected Trump's push for deregulation to give crypto a boost, and initially, that seemed to be the case. Bitcoin surged past $100,000 in early December, and at one point was even up over 50% following the election.

But the rally didn't last. By late January, bitcoin had dropped to under $89,000 and even briefly dipped under $80,000 last week. We'll continue to monitor developments, but for now, our advice for long-term investors remains the same: Exercise caution with crypto. Its volatile swings make it highly risky, and it may not be the most appropriate for large portions of your hard-earned savings.

And that's it for this episode of 3 Things You Need to Know This Week.

For more of our thoughts on markets, Check out This Week in Review, released every Friday. You can also visit fisherinvestments.com for more insights. Thanks for tuning in and don't forget to subscribe!