Navigating markets in 2025
Inflation, geopolitical instability, and energy transitions require a proactive approach to protect wealth.
Join Paul Holba, SVP and CIO, Empire Life Investments Inc., as he provides expert insights into the key trends that will shape the markets in 2025, including inflation trends, central bank policies, geopolitical risks, and the resurgence of nuclear energy.
When we look back on 2024, we witnessed inflation come down around the world, with central banks in developed markets, like the US, cutting interest rates. Even faced with persistent inflation above the 2% target, these actions helped avoid a recession and maintain economic stability. Conversely, Japan saw inflation re-emerge, prompting the Bank of Japan to raise rates twice.
Geopolitics was at the forefront, with many global elections seeing incumbents struggle as many populations sought change from governments that managed them through the COVID-19 crisis.
The return of President Trump to the White House in 2025, chief among them. This transition of power south of the border is expected to bring significant policy changes and geopolitical shifts.
As we turn our focus to 2025, we see a bifurcated world with the US showing higher levels of growth while the rest of the world pivots from worries about inflation towards supporting economic growth and arresting deterioration of growth.
Inflation stands to be a continuing issue as central banks around the world move away from restrictive monetary policy and spur economic growth. Geopolitics are set to influence markets worldwide, as President Trump plans to impose tariffs on Canada, Mexico, and potentially China and Europe. These measures could serve as negotiation tools, impacting trade dynamics around the globe. And finally, we’re in the midst of an energy transition, as nuclear energy falls into favour again as governments grapple with the reality of powering the continued electrification of our world.
Our investment strategies reflect our cautious view of the environment. Right now, we’re taking a defensive stance by diversifying our investments across different asset classes, sectors, and regions. We’ll keep focusing on picking the right companies best positioned to navigate the uncertainties facing the global economy.
The investment team will also use any market volatility to buy shares in some high-quality companies “on-sale” because their valuations have dropped to levels below what we feel they are worth.
Thank you for joining us in exploring our economic outlook for 2025. As we navigate these complex dynamics, staying informed and adaptable will be crucial for success in the evolving global landscape.
This video includes forward-looking information based on the opinions and views of The Empire Life Insurance Company and Empire Life Investments Inc. as of December 18, 2024 and is subject to change without notice. The information contained herein is for general informational purposes only, and should not be considered a recommendation to buy or sell any security, nor should it be relied upon as investment, tax, or legal advice. Empire Life and its affiliates assume no responsibility for any reliance on, misuse of, or omission of any information contained in this video; and do not warrant or make any representations regarding the use or the results of the information contained herein in terms of its correctness, accuracy, timeliness, reliability, or otherwise, and do not accept any responsibility for any loss or damage that results from its use. Please seek professional advice before making any investment decisions.
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January 2025
