Watches of Switzerland's shares fall 6% after Donald Trump slaps 39% tariff
The retailer, which sells Rolex and other Swiss timepieces in the UK and the US, bore the brunt of the latest tariff salvo. Financial markets in Switzerland were closed for a holiday, initially sparing listed producers such as Richemont and Swatch Group AG.
Swiss watch exports had already been hit in advance of the latest news, surging in the spring when Trump threatened a 31% levy as importers in other markets tried to get in ahead of the tariffs, then easing on hopes of a settlement at a lower rate.
If the 39% tariff goes ahead, it could require price increases of more than 20% in the US, according to Jefferies analysts led by James Grzinic. There's also a possibility that the tariffs don't go into effect.
'The one-week hiatus until implementation suggests this could be a negotiating tactic,' he said in a note.
Swiss watch exports dropped by almost 10% in May led by a slump in shipments to the US.
'The rise of 'luxury fatigue,' a declining 'feel-good factor' from luxury purchases, and worsening consumer sentiment all contribute to a less optimistic outlook,' Vontobel analyst Jean-Philippe Bertschy said in a note last month.
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First Post
3 minutes ago
- First Post
Jobs data firestorm: Trump blasts ‘rigged' numbers after poor hiring revisions
President Trump fired the BLS commissioner after accusing the agency of rigging job numbers. The firing follows sharp downward revisions to job data for May and June, raising concerns about political interference and economic data reliability read more The monthly jobs report is already highly watched on Wall Street and in Washington, but it has taken on additional importance since President Donald Trump sacked the officer in charge of it on Friday. Trump said that June's job data were 'RIGGED' to make him and other Republicans 'look bad,' but he offered no evidence. Erika McEntarfer, the Bureau of Labor Statistics (BLS) commissioner nominated by former President Joe Biden, was fired following Friday's employment report, which revealed that hiring was poor in July and had practically came to a halt in May and June, just after Trump imposed massive tariffs. STORY CONTINUES BELOW THIS AD Economists and Wall Street investors have traditionally regarded job data as credible, with share prices and bond yields frequently responding dramatically when they are announced. However, Friday's revisions were extraordinarily large, the greatest outside of a recession in five decades. In addition, the surveys utilised to generate the report face issues due to diminishing response rates. Despite this, most economists do not doubt them. 'The bottom line for me is, I wouldn't take the low collection rate as any evidence that the numbers are less reliable,' Omair Sharif, founder and chief economist at Inflation Insights, a consulting firm, said. Heather Boushey, a top economic advisor in the Biden White House, noted that without Trump's firing of McEntarfer, there would be more focus on last week's data, which points to a slowing economy. 'We're having this conversation about made-up issues to distract us from what the data is showing,' Boushey said. 'Revisions of this magnitude in a negative direction may indicate bad things to come for the labour market.' Here are some things to know about the jobs report: Economists and Wall Street trust the data Most economists say that the Bureau of Labor Statistics is a nonpolitical agency staffed by people obsessed with getting the numbers right. The only political appointee is the commissioner, who doesn't see the data until it's finalized, two days before it is issued to the public. STORY CONTINUES BELOW THIS AD Erica Groshen, the BLS commissioner from 2013 to 2017, said she suggested different language in the report to 'liven it up', but was shot down. She was told that if asked to describe a cup as half-empty or half-full, BLS says 'it is an eight ounce cup with four ounces of liquid.' The revised jobs data that has attracted Trump's ire is actually more in line with other figures than before the revision. For example, payroll processor ADP uses data from its millions of clients to calculate its own jobs report, and it showed a sharp hiring slowdown in May and June that is closer to the revised BLS data. Trump and his White House have a long track record of celebrating the jobs numbers — when they are good. Securing the data Rigging the numbers would be difficult. Hundreds of economists and statisticians are involved in compiling the monthly jobs report, and they follow 'transparent, well-established methodologies,'' Heidi Shierholz, the Labor Department's chief economist in the Obama administration, wrote in a commentary Friday. STORY CONTINUES BELOW THIS AD 'It is very, very difficult to tamper or to interfere with these numbers,'' Elaine Chao, Labor secretary in the George W. Bush administration, told CNBC Monday. In the week before the numbers are released, she said, 'the process is very much locked down'' with about 40 people involved in the final preparations. 'If anything were to be awry, I think one of these 40 people in the final analysis would have spoken up,'' Chao said. The BLS commissioner only sees the numbers after they are final — usually the Tuesday before the report comes out on Friday. The White House Council of Economic Advisors gets a look and a briefing from the commissioner or BLS staff on Thursday, Groshen said. These are the figures Trump is attacking Trump has focused on the revisions to the May and June data, which on Friday were revised lower, with job gains in May reduced to 19,000 from 144,000, and for June to just 14,000 from 147,000. Every month's jobs data is revised in the following two months. STORY CONTINUES BELOW THIS AD Trump also repeated a largely inaccurate attack from the campaign about an annual revision last August, which reduced total employment in the United States by 818,000, or about 0.5%. The government also revises employment figures every year. Trump charged the annual revision was released before the 2024 presidential election to 'boost' Vice President Kamala Harris's 'chances of Victory,' yet it was two months before the election and widely reported at the time that the revision lowered hiring during the Biden-Harris administration and pointed to a weaker economy. Here's why the government revises the data The monthly revisions occur because many companies that respond to the government's surveys send their data in late, or correct the figures they've already submitted. The proportion of companies sending in their data later has risen in the past decade. Every year, the BLS does an additional revision based on actual job counts that are derived from state unemployment insurance records. Those figures cover 95% of US businesses and aren't derived from a survey but are not available in real time. STORY CONTINUES BELOW THIS AD Betsey Stevenson, a University of Michigan professor and former chief economist at the Labor Department, stressed that the government also needs to be able to release the data in a timely manner, so that companies have a sense on a monthly basis about how the economy is faring. The revisions help to ensure the timely release while improving accuracy over time, she said, adding that lawmakers need to make investments to modernize data collection. 'The trade offs between cost, speed, and accuracy are decisions made by Congress,' she said. 'The president seems frustrated by his own party's policy choices around national statistics.' Factors that cause revisions Figuring out how many new jobs have been added or lost each month is more complicated than it may sound. For example, if one person takes a second job, should you focus on the number of jobs, which has increased, or the number of employed people, which hasn't? (The government measures both: The unemployment rate is based on how many people either have or don't have jobs, while the number of jobs added or lost is counted separately). STORY CONTINUES BELOW THIS AD Each month, the government surveys about 121,000 businesses and government agencies at over 630,000 locations — including multiple locations for the same business — covering about one-third of all workers. Still, the government also has to make estimates: What if a company goes out of business? It likely won't fill out any forms showing the jobs lost. And what about new businesses? They can take a while to get on the government's radar. The BLS seeks to capture these trends by estimating their impact on employment. Those estimates can be wrong, of course, until they are fixed by the annual revisions. The revisions are often larger around turning points in the economy. For example, when the economy is growing, there may be more startups than the government expects, so revisions will be higher. If the economy is slowing or slipping into a recession, the revisions may be larger on the downside. Revisions seem to be getting bigger STORY CONTINUES BELOW THIS AD The revisions to May and June's job totals, which reduced hiring by a total of 258,000, were the largest — outside recessions — since 1967, according to economists at Goldman Sachs. Kevin Hassett, Trump's top economic advisor, went on NBC's 'Meet the Press' on Sunday and said, 'What we've seen over the last few years is massive revisions to the jobs numbers.' Hassett blamed a sharp drop in response rates to the government's surveys during and after the pandemic: 'When COVID happened, because response rates went down a lot, then revision rates skyrocketed.' Yet calculations by Ernie Tedeschi, an economic advisor to the Biden administration, show that while revisions spiked after the pandemic, they have since declined and are much smaller than in the 1960s and 1970s. Other concerns about the government's data Many economists and statisticians have sounded the alarm about things like declining response rates for years. A decade ago, about 60% of companies surveyed by BLS responded. Now, only about 40% do. The decline has been an international phenomenon, particularly since COVID. The United Kingdom has even suspended publication of an official unemployment rate because of falling responses. And earlier this year the BLS said that it was cutting back on its collection of inflation data because of the Trump administration's hiring freeze, raising concerns about the robustness of price data just as economists are trying to gauge the impact of tariffs on inflation. US government statistical agencies have seen an inflation-adjusted 16% drop in funding since 2009, according to a July report from the American Statistical Association. 'We are at an inflection point,' the report said. 'To meet current and future challenges requires thoughtful, well-planned investment … In contrast, what we have observed is uncoordinated and unplanned reductions with no visible plan for the future.
The Hindu
3 minutes ago
- The Hindu
India's presence amid a broken template of geopolitics
It is time for India to punch its weight and enhance its global presence at a time when global geopolitics is being reset. But, as of now, it is not moving India's way. Operation Sindoor was a reality check when many of India's strategic partners were not willing to call out Pakistan for harbouring United Nations-sanctioned terrorist groups and terrorists. It is now known that three of the perpetrators of the Pahalgam attack (April 22, 2025), who were eliminated recently, were Pakistanis belonging to the Lashkar-e-Taiba. While India's retaliation against terror camps in Pakistan was decisive, it struggled to get this narrative out in the face of United States President Donald Trump repeatedly claiming that it was he who had brought about a ceasefire using trade as a weapon — a claim contradicted by the Government in the recent parliamentary debate. In an unkind twist, Pakistan's Field Marshal Asim Munir was invited to lunch with Mr. Trump after Operation Sindoor. However, the U.S. designated The Resistance Front (TRF), which claimed responsibility for the Pahalgam attack, as a Foreign Terrorist Organization (FTO) and Specially Designated Global Terrorist (SDGT). And in a welcome recognition, the report by the UN Security Council's Monitoring Team also named the TRF for the Pahalgam attack. A path with Trump-created hurdles But all is not well. On a historic day when the NISAR satellite (India-U.S. collaboration) was launched, Mr. Trump hit India with a 25% tariff. However, he made a purely trade issue, which could have been resolved in negotiations, into a geopolitical issue, threatening India by 'substantially' raising tariffs for its importing Russian oil when Ukrainians are being killed by the 'Russian War Machine.' India was being trumped especially when Mr. Trump himself is a strong votary of U.S.-Russian rapprochement. While one can dismiss this as typical Trump-style last minute pressure, he has already called on U.S. companies not to invest in India but only in the U.S., and hire only Americans. This comes on the heels of the U.S.'s lopsided security and trade deals with its Indo-Pacific allies and the European Union (EU). American tech giant Nvidia has been permitted by the U.S. to resume sales of its H20 AI chips to China, stopped earlier due to national security concerns. More time has been given to China to get the deal done. After getting bogged down in Ukraine and West Asia, the U.S. has less focus on East Asia. Consequently, if a broader geopolitical understanding between the U.S. and China on East Asia was to come about, it would constrict the space for India. East Asian countries are already hedging their bets. The U.S.'s posturing on South Asia has not helped either. Growing U.S.-Pakistan relations have again become an irritant. Even if this is a reset in bilateral relations, the U.S. has displayed astonishing insensitivity to India's security concerns by praising Pakistan for counter-terrorism efforts, and regional stability. In Bangladesh, the U.S. had gone against Indian interests in supporting the ouster of Sheikh Hasina. In Myanmar, U.S. and European support for forces opposing the military government is destabilising India's north-east. After Galwan and Pahalgam, India's hope for better understanding and coordination with the U.S. on regional security interests has been belied. Mutual trust is being rapidly eroded. Acting in concert with the U.S., the EU is targeting India's import-led energy security at a time when India is negotiating an India-EU Broad-based Trade and Investment Agreement. The EU has sanctioned India's Vadinar Refinery, where Russian Rosneft has a large stake, knowing full well that stopping Russian oil into India will lead to huge pressure on oil prices. On the other hand, Hungary, Slovakia, Belgium, Spain and others are importing Russian oil, through pipelines and as LNG, by securing exemptions or under existing contracts. Europe receives 51% of Russian LNG exports. The EU's carbon border tax and digital and other trade barriers on India remain. India hopes that the recently concluded India-U.K. Comprehensive Economic and Trade Agreement (CETA) will force the EU to climb down from its asks in its trade negotiations. China's moves All this has given China an opportunity to, once again, become active in India's neighbourhood. China has proposed new groupings and new deals to keep India out. For example, China's meeting with Pakistan and Bangladesh in Kunming on June 19, 2025 proposed formalising a trilateral initiative, but Bangladesh has not agreed. China is also helping Bangladesh revive a Second World War airbase at Lalmonirhat which is close to the Siliguri Corridor. China's support to Pakistan during Operation Sindoor was extensive. China has also standardised Mandarin names for locations within Arunachal Pradesh. And it wants to seize the future of the institution of the Dalai Lama from India. Riding on a huge trade surplus with India, China is squeezing India's crucial supply chains such as rare earths, fertilizers, Active Pharmaceutical Ingredients, tunnel boring machines and technical personnel. More worrying is the planned construction of China's largest dam in Tibet on the Yarlung Zangbo (Tibetan name for the Brahmaputra), which is near the Indian border. Prime Minister Narendra Modi's recent visit to the Maldives has been timely given China's influence. To counterbalance an unpredictable, and even unreliable, U.S., an unresponsive EU and an aggressive China, India is carrying out a tightrope act. It has prioritised accelerating the current thaw in relations with China to reset equations after the Galwan conflict — despite there being no move towards de-escalation on the border after the initial disengagement in October 2024. Further, India should seriously rethink its stand to remain on the margins of global conflicts. India has been largely silent, if not openly pro-Israel, on the ongoing Israel-Gaza war — an unfolding multidimensional human tragedy. India was also largely silent on the recent Israel-Iran conflict and American bombings, despite important relations with both warring parties and huge stakes in the Gulf. Though it rightly abstained on the UN votes on the Ukraine conflict, its overall approach of not taking a proactive stand on world conflicts may hurt its larger interests and diminish its geopolitical clout as long as it remains on the sidelines. Operation Sindoor has shown India that if it seeks a greater engagement of its partners with its conflicts and issues, India needs to engage more with their conflicts and issues. Some argue that India should keep its head down and focus on becoming the third largest economy and that a larger geopolitical role may hurt its economic growth. The contrary is true. In a fragmenting world order, geopolitics, coercion and threats and protectionism are determining economic and technological outcomes — not most favoured nation or free trade or multilateral World Trade Organization-led trade norms. Therefore, to get its economic and technological trajectory right, India needs to get its geopolitics right. The road ahead Realising that the geopolitical space is shrinking, India is finally breaking free and has objected to the 'targeting'. It has called out the double-speak of the U.S. and the EU under the guise of safeguarding their economic interests — the EU for larger trade in goods and services with Russia than India in 2024, and the U.S. for importing Russian uranium, palladium, fertilizers and chemicals. India's call for a ceasefire in Gaza (it abstained on a similar UN General Assembly resolution two months ago), is a realisation that it needs to be assertive in global conflicts to preserve its strategic autonomy. Facing an erosion of trust with the U.S. and a U.S.-China deal, India needs to clinch an India-U.S. trade deal soon to prevent a further deterioration of relations and to persuade Mr. Trump to travel to India for the Quad summit (India-U.S.-Japan-Australia). After Mr. Trump's outburst, it is a moot point whether India will revive the RIC (Russia-India-China). However, greater engagement with BRICS (2026 summit in India), the Shanghai Cooperation Organisation and with East Asia (having missed the Regional Comprehensive Economic Partnership bus), will only reinforce India's policy of multi-alignment and push back those who constrain it. No more can India just put our head down, mind its own economic business and expect to grow. That template is now broken. T.S. Tirumurti is former Ambassador/Permanent Representative of India to the United Nations, New York and former Secretary, Ministry of External Affairs, New Delhi
The Hindu
3 minutes ago
- The Hindu
Bullying tactics: on India pushing back against the U.S., the EU
After months of considerable forbearance, the statement by the Ministry of External Affairs (MEA), on Monday, pushing back against the U.S. and the European Union (EU) for 'targeting' India is significant. The statement came two hours after Mr. Trump had announced penalty tariffs against India, 'substantially' above the current 25% rate set to go into place this week, for importing, processing and selling Russian oil. A day earlier, a senior Trump aide had accused India of 'financing' Russia's war in Ukraine. And on July 18, the EU had announced sanctions on India's Vadinar refinery (partially Russian owned), and secondary sanctions that will affect Indian refiners. The MEA spokesperson said that the measures were 'unjustified and unreasonable' as the U.S. and the EU continue to trade with Russia for goods including LNG, critical minerals and nuclear fuel requirements. The statement also said that it was the U.S. that had encouraged India to keep buying Russian oil to stabilise global markets, something the Biden administration had confirmed. The government said that in comparison to the western countries, India's Russian oil purchases are a 'vital national compulsion' as a result of the conflict in Ukraine, adding that India would '... safeguard its national interests and economic security'. The MEA's statement is the first such clear response on the issue since the Ukraine conflict. Taken with Union Minister Piyush Goyal's statement last week on the U.S. announcement of 25% reciprocal tariffs on India from August 7, Monday's statement indicates New Delhi's growing frustration with the U.S.'s increasingly offensive positions against India, including on immigration, trade negotiations, Operation Sindoor and Pakistan, and India's BRICS membership. It is unclear how and to what extent the government is prepared to stand up to the bullying tactics of Mr. Trump. Mr. Trump said on Tuesday that India has not been a 'good trading partner' — a possible reference to trade talks and the failure of a mini-deal, ostensibly over India's resistance on agricultural market access, dairy products and GM foods. While it is hoped that New Delhi will continue to engage Washington and Brussels to conclude their respective trade talks, the MEA statement is meant to make a larger point. Neither the U.S. nor the EU can decide which country India will partner or trade with. That message is being underlined in visits by Security Adviser Ajit Doval and External Affairs Minister S. Jaishankar to Moscow, to prepare for the Russian President's visit to India later this year. India's sovereignty is non-negotiable and its foreign policy choices cannot be manipulated by other countries, no matter how significant their own ties with India are.
