Evolution rather than Revolution at the Fed
The risk of market-moving changes to the Federal Reserve’s monetary policy approach has eased, though broader “Trumponomics” risks to growth and inflation persist.
Persistent Global Trade Fragmentation
Ongoing US-China tensions and new tariff measures are accelerating trade fragmentation, raising costs and sustaining inflationary pressures.
China’s Gradualism and Market Confidence
China’s cautious stimulus limits growth but boosts investor confidence through stability and tech support, while persistent US-China tensions keep global trade fragmented and costly.
Easing Geopolitical Risks Outside Europe
The Gaza cease-fire reduces energy and regional risks, while Russia-Ukraine tensions continue to pose isolated energy supply threats.
Uneven Policy Momentum in Europe and the UK
Europe’s reforms have slowed as growth remains modest, while the UK faces fiscal challenges that could improve with clearer strategy and discipline.
