No, we do not think so. While the European Central Bank and Bank of England have adopted a more hawkish tone in response to the Iran-driven energy shock, we believe markets are overpricing the amount of tightening that will ultimately be delivered.
German equities entered 2025 with strong momentum, supported in part by a sharp shift in Germany’s fiscal outlook. After years of underinvestment, the government announced materially higher spending on infrastructure and defense. However, that momentum faded through 2025 into 2026, and German equities stalled.
Global economic growth hovered near trend in 2025. The dollar weakened sharply, while global equities and commodities posted strong gains. Bond returns improved as rates and credit spreads eased.
In this edition of VantagePoint, we examine how the rise of AI is reshaping the global energy landscape and highlight the most compelling opportunities and risks for investors.
US tariffs added to market volatility in the fiscal year ended June 30, 2025. Nevertheless, most risk assets ended the year higher, supported by strong earnings ahead of tariff uncertainty and the prospect of continued central bank policy easing to support growth.
In this edition of VantagePoint, we examine the historical context of the dollar, outline why we believe the recent decline is likely part of a multi-year bear market, and discuss strategies investors can use to reduce their dollar exposure.
After a prolonged period of US outperformance, many investment portfolios have become heavily concentrated in US equities, but recent policy shifts now challenge US economic and financial hegemony. Investors should carefully evaluate these exposures to determine if greater diversification is warranted.
Yes, in response to weak growth and a changing defence landscape, taking off the fiscal straitjacket should catalyse a more growth-supportive economic environment within Europe.
No. All three factors have weighed on euro area equity and currency markets to some extent in recent months, but we recommend continuing to hold euro area equities at benchmark weights.
Most risk assets enjoyed strong returns in the calendar year (CY) ended December 31, 2024. US equities led on better-than-expected economic data and AI-related growth.