Economic Update March 2025

Global economic performance is becoming increasingly disparate, and consequently so are central bank responses with most becoming increasingly cautious in the easing phase of this cycle. Further, frenetic news flow out of the US regarding trade policy and geopolitics is creating an environment of uncertainty in both major economies and markets.

Key Themes

Economic Growth
Downside near-term risks in the US stemming from policy uncertainty. Growth still expected to be modest in most other developed markets.

Equity markets
Equity market gains have been in non-US markets year to date prompted by narrow gains in some sectors. US markets post modest gains with valuations stretched.

Fixed income
Elevated starting yields in the US are still holding the attention of more defensive investors, with attractive yields up the credit curve for those more confident in the economic outlook.