Relief for Hormuz, a reality check for tech

The defining move of late June was a sharp reversal in oil. A US and Iran memorandum of understanding helped restore shipping through the Strait of Hormuz, and crude fell almost 10% in a week to below $70 a barrel, having traded as high as $120 during the conflict. Lower energy prices eased some inflation fears, but attention quickly turned to the other side of the market, technology and AI valuations, as investors questioned whether the enormous capital flowing into AI infrastructure will pay off quickly enough. The US Nasdaq index fell for five sessions in a row, its longest losing streak of the year.

Markets year to date. Despite the late-June wobble in technology, global equity markets remain positive for the year, with Japan among the strongest performers and Ireland lagging the major developed markets. Government bond yields sit around 4.4% on the US 10-year and roughly 3% on the Irish and German equivalents, reflecting the shift in rate expectations.

What this means for your portfolio. Inflation is the stubborn story underneath the headlines. US core inflation is running at its highest in over two years, reinforcing the “higher for longer” view on rates. For Irish investors, the level of the euro against the dollar continues to shape returns, helping in some periods and hurting in others. If you want to review how your fund or portfolio is positioned for a higher-rate, higher-volatility environment, get in touch.

The ECB has hiked: what it means for your mortgage

On 11 June the ECB raised rates by 0.25%, taking the deposit rate to 2.25% and the main refinancing rate, the one tracker mortgages are linked to, to 2.4%. It was the first increase in close to three years, driven by the inflation impulse from the Iran conflict. The market view is that a further hike in September is the most likely next step, with the next decision due in July.

Borrowers on fixed rates are protected for now, but lenders are already moving fixed rates up for new business, and at least one lender raised fixed rates earlier in the year on funding-cost fears. Brokers are urging anyone who has not reviewed their position to do so without delay, as the window to secure the best rates is closing. Every case depends on your balance, remaining term and circumstances, so it is worth a proper review rather than a rule of thumb.

A new State Investment Account is taking shape

On 22 June the Tánaiste and Minister for Finance Simon Harris, with Minister of State Robert Troy, convened a Consumer Round Table on the planned new Investment Account. The Government intends to bring forward legislation as part of the Finance Bill 2026, with accounts expected to be available from 2027. The stated aim is to make investing simpler, more accessible and more trustworthy, so that more households move beyond deposits and share in long-term growth.

Ireland has roughly €170 billion sitting in bank deposits, a strong savings culture that has never translated into an investing one, largely because the tax system makes funds complex and unrewarding to hold. Based on what has been signalled, the account is expected to feature a simple low flat-rate annual tax, no capital gains tax on returns inside the account, and crucially the removal of the 8-year deemed disposal rule that currently penalises long-term fund investors. Budget 2026 already cut exit tax from 41% to 38% as a first step.

The features above reflect Government signalling and industry expectation. The final design will depend on the legislation, and we will cover the detail as it is published.

SpaceX’s record IPO, and a lesson for retail investors

SpaceX went public on 12 June in the largest IPO in history, pricing at $135 a share, raising around $75 billion at a valuation near $1.8 trillion. Demand was extraordinary. The book was oversubscribed more than twice, and unusually about 30% of shares were allocated to retail investors, against the single-digit allocations that are typical. The stock closed its first day at $161, up 19%, and peaked above $225 within days, briefly carrying the company past Amazon and Microsoft.

By late June the shares were trading around $153, still above the IPO price, but a long way below the post-listing high, and a stark round trip for anyone who bought near the top. The point is not whether SpaceX is a good company. It is that excitement and valuation are different things. A high-profile listing with heavy retail participation is exactly where ordinary investors are most likely to overpay, concentrate their risk, and react to volatility at the worst possible moment. Single-stock bets, especially in newly listed, richly valued names, belong if anywhere in the small satellite portion of a diversified plan, not at its core.

State Savings, deposits and the pension question

With so much attention on what to buy, it is worth asking what idle cash is doing. Take State Savings, the An Post and NTMA range that includes Prize Bonds, savings certificates and savings bonds. They are popular and State-guaranteed, but the returns are very low. For Prize Bonds, the entire prize fund is set by a variable rate of just 1.00% of the total held, a notional, tax-free return of around 1% spread unevenly across prize winners, so most holders win little or nothing in a given year. The fixed-term State Savings products pay only modest rates over multi-year terms.

Shopping around on deposits. Irish banks still pay very little on everyday savings. EU deposit platforms such as Raisin give Irish savers access to roughly 90 accounts from 16 European banks, with rates recently up to around 3% on one to three year terms, and deposit protection up to €100,000 per person per bank. Two things to know: the banks are based outside Ireland, and DIRT is not deducted at source, so you must declare the interest on your Irish tax return yourself. For cash you genuinely want to keep in deposits, that is a meaningful step up from leaving it with a pillar bank at near zero.

But deposits are not the whole answer. This is the same €170 billion deposit pile the new Investment Account is designed to address. The point is not to chase risk, it is to match each pot of money to its job: an emergency fund in accessible cash, medium-term goals appropriately structured, and long-term money working in a tax-efficient vehicle. And on tax efficiency, nothing in Ireland competes with a pension.

Will Ireland weather the storm? Jim Power’s mid-year read

Economist Jim Power’s mid-year review frames 2026 as a year knocked off course by the Iran war from late February, but one the Irish economy has so far absorbed reasonably well. The headlines:

• Headline GDP fell 12.1% in Q1, but that is a multinational distortion, the unwinding of last year’s tariff-driven pharmaceutical export surge, not a real-economy collapse.
• Modified Domestic Demand, the better gauge of the real economy, rose 0.6% in the quarter and was 4.3% higher than a year earlier. The labour market is solid at about 2.79 million employed, and tax revenues keep growing.
• Real-economy growth of around 2.5% looks achievable for 2026.
• Consumer confidence fell sharply in spring on war fears, then rebounded over 11% in May as energy costs eased, though it remains well below its long-run average.
• Central banks have pivoted. The ECB hiked in June, the Bank of Japan raised to 1% (its highest since 1995), while the Fed and Bank of England held but dropped their easing bias.
• Oil is the swing factor for the second half. Brent traded as high as $120 during the conflict before easing back. A durable peace would cool inflation; a relapse would do the opposite.
• Domestic markers ahead: a €750m Government energy support package, and Budget 2027 on 6 October.

Economic commentary summarised from Jim Power’s Mid-Year Economic Review, June 2026.

Four things worth acting on this summer

1. Note your mortgage fixed-rate end date

   If you are on a fixed rate, find out exactly when it expires. With rates rising, you want to be reviewing options months ahead, not the week it rolls off onto a higher variable.

2. Give idle cash a job

   Separate your emergency buffer, which should stay accessible, from long-term savings sitting in low-return products. Money earning around 1% is losing to inflation. Shopping around on deposits, or investing for the long term, can both do better depending on the goal.

3. Be sceptical of IPO and influencer hype

   SpaceX is the latest reminder: heavy retail participation in a hot listing is where people most often overpay. Anything you cannot explain the tax treatment and the risk of, you probably should not be buying.

4. Max your pension before year-end planning starts

   Nothing else delivers an immediate 40% (or 20%) return through tax relief, with tax-free growth and no deemed disposal. If you have capacity, use it before any other investment idea.