2025 Global Market Risk

🚨2025 Global Market Risk

1. Introduction of Tariffs (90%)
   •Tariffs are likely to be introduced, which could affect global trade.
2. Nvidia earnings below expectations (90%)
   •NVIDIA’s performance is likely to fail to meet high market expectations, posing a risk to the technology sector as a whole.
3. Re-accelerate the U.S. economy (85%)
   •The U.S. economy is expected to return to life, boosting investor confidence and market activity.
4. Increase in M&A/IPO activity (75%)

• M&A and IPO activities are expected to increase significantly.

5.Fed stops discussing r-star (70%)
•The Federal Reserve is likely to stop discussing natural interest rates (r-star), which could lead to policy uncertainty.

6. U.S. Q1 Inflation Acceleration (40%)
   •Strong economic growth, tariffs, immigration restrictions, and seasonal factors are likely to push inflation higher in the first quarter.

7.Fed raises interest rates in 2025 (40%)
•The Fed is likely to raise interest rates in 2025.

8. U.S. 10-year interest rates rise more than 5% (40%)
   •U.S. 10-year Treasury yields likely exceed 5% before mid-2025.
9. Germany’s economic downturn (40%)
   •The chance of Germany falling into recession is rated moderate.
10. China’s economic downturn (33%)
    •The chances of China facing a recession are predicted to be around 33%.
11. U.S. fiscal crisis (10%)
    •A financial crisis is unlikely in the United States, but it exists.
12. U.S. economic downturn (0%)
    •Little chance of the U.S. falling into recession in 2025.

Key insights:
•Tariffs and Nvidia risks are the biggest risk factors: The highest risk is likely to come from Geopolitical factors (tariffs) and Technical sectors (NVIDIA underperformance).
•U.S. Economic Growth Expectations: The U.S. economy looks set to pick up steam, which could offset recession concerns.
•Economic imbalances by region: Although the U.S. recession is unlikely, Germany and China are relatively likely to experience an uneven global economy.
•Rate Volatility: The likelihood of rising interest rates may affect loan costs and investment patterns.