We released our 2025 Investment Outlook. Geopolitics and policy shifts are creating a more fragmented world, but new opportunities emerge in the global reordering.
Forecasts are based on information and policy measures available as of 6 November 2024.
We forecast global growth to soften at 3.0% in 2025 and 2026. The growth differential between Emerging and Developed Markets should also stabilise, with EM growing +3.9% and DM +1.6% over the next two years. We expect the US economy to mildly decelerate towards a soft landing; Europe’s recovery towards potential growth to be modest and progressive, and Asia to remain a major driver of growth, despite China’s slowdown.
Confirmation that disinflation is on track should support more dovish monetary policies. Central banks in the US and Europe should continue to cut rates. By end of 2025, we anticipate terminal interest rates to reach 3.5% in the US, 2.25% in the Eurozone, 3.50% in the UK. By contrast, Bank of Japan is anticipated to implement two more hikes. EM Central Banks intend to deploy more independent policies, easing gradually.
