2025 is not just any other year for the markets. After years of adjustments, uncertainty and new trends, it is shaping up to be a period in which investment decisions could make a crucial difference in future results. In this context, being selective has never been more important. The global economy, geopolitical tensions and the technological revolution raise fundamental questions that cannot be ignored. These are the key questions you should be asking yourself to face this year with the best possible strategy.
Will the cycle of interest rate cuts be short-lived?
2025 begins with important changes in global monetary policy. In the United States, the Federal Reserve has begun to cut interest rates, placing them in the range of 4.25%-4.5%, with forecasts of reaching 3.5% by mid-year. This occurs in a context where core inflation remains around 2.5%, according to the PCE index. However, high levels of public debt (more than 120% of GDP) could limit the scope of the cuts.
In Europe, the European Central Bank is following a similar path, with rates that could close the year at 1.5%, a historic low, while inflation is around 3%. Spain leads growth in the eurozone, with an expected increase of 2.5% of GDP, but it is doing so supported by public debt that exceeds 112% of GDP. Japan, for its part, could make its first rate hike in decades, driven by 5% wage growth in 2024 and controlled inflation.
Will these adjustments be enough to stimulate growth without rekindling inflation? For investors, this mixed environment could mean opportunities in short-term fixed income and sectors less sensitive to rate fluctuations, such as consumer staples and healthcare.
How much will geopolitical tensions impact markets?
From the conflict in Ukraine to escalating tensions between Israel and Iran, geopolitical factors will be key in 2025. With Donald Trump back in the White House, protectionist trade policies, such as possible 60% tariffs on Chinese imports, promise to shake up global supply chains. The yuan has already lost more than 12% of its value against the dollar since the end of 2024, and Chinese exports have fallen 8% year-on-year.
In Europe, early elections in Germany and France will add volatility to markets, with the risk of less clear fiscal policies. In the Middle East, analysts fear an escalation between Israel and Iran, which could push up oil prices, currently at $75 a barrel of Brent.
Investors will need to keep an eye on strategic sectors such as defence, energy and commodities, which could benefit from these dynamics. Safe haven assets such as gold, which is trading at $2,670 per ounce, will remain crucial to managing geopolitical risk.
Will global debt limit investment opportunities?
The level of global public debt will exceed $100 trillion by 2024, reaching close to 100% of global GDP. In the United States, the fiscal deficit reached 6.7% of GDP, while in Europe, countries such as France are facing significant fiscal problems and Germany is experiencing a lack of growth.
Spain and Italy, however, are offering competitive yields on their sovereign debt. Spanish 10-year bonds currently offer a yield of 3.07%, while Italian ones are around 3.5%.
For investors, this decoupling situation in Europe raises questions about fiscal sustainability and risk premiums. Which assets can withstand this environment? Sovereign bonds from more stable markets, such as Spain and Italy, could be an attractive option for those seeking security with some yield.
What role will artificial intelligence play as a driver of growth?
The technological revolution led by artificial intelligence (AI) promises to transform entire industries. From automation in manufacturing to personalization in services, AI has captured the attention of markets.
Semiconductor leader NVIDIA saw its market value exceed $1.2 trillion by 2024, growing 170% annually, but can this trend continue? Investors need to assess whether current valuations reflect excessive optimism or whether there is still room for growth as more industries adopt these technologies. Identifying companies with sustainable models and diversifying through thematic exchange-traded funds or ETFs and technology funds will be crucial.
Which sectors will be the winners in the energy transition?
The fight against climate change will continue to drive investment in 2025. Global spending on clean energy could exceed $1.7 trillion this year, according to the International Energy Agency.
Copper, essential for electrification, is in demand and could rise by 15% over the next five years. Its price is currently around $9,000 per tonne, but is expected to reach $10,500 by the end of 2025. But the market raises big questions. Can companies in transition compete with established giants such as oil companies? Sectors such as mining and clean technologies offer opportunities, but require a thorough analysis of their long-term viability.
Which emerging countries will be the winners in a global decoupling scenario?
The trade decoupling between the United States and China is reshaping supply chains. Mexico, already the largest exporter to the United States, has seen a 15% increase in foreign direct investment in 2024. On the other hand, Vietnam and Malaysia are struggling due to their dependence on Chinese exports.
On the other hand, Washington’s tariff policies and the devaluation of the Chinese yuan are creating mixed conditions for emerging markets. Is it time to bet on these economies? Investors could consider diversified ETFs that include countries with good growth prospects, but also be prepared to deal with the volatility inherent in these markets.
Where will the best investment opportunities be in 2025?
The big question for any investor: which assets to focus on this year? Despite its importance, the answer will always depend on the profile of each investor, the risk they are willing to take, the capital or the knowledge of each investor. In any case, in general terms, for the most conservative, deposits and short-term fixed income could continue to offer stability in an environment of falling interest rates.
Meanwhile, those interested in generating passive income can explore high-dividend stocks. This approach allows investors to benefit from regular payouts that, in many cases, offer higher returns than traditional low-risk instruments. Sectors such as energy, financials and telecommunications often stand out for offering solid dividends, backed by stable business models and consistent cash flows.
On the other hand, those seeking growth could look to technology, renewable energy or healthcare sectors, where global megatrends promise long-term opportunities. Finally, gold, which has reached recent all-time highs, remains a safe haven from global uncertainties.
