“To develop possible forecasts on long -term lengthwise yields of the main asset class, the exploration of multiple scenarios and global trends is essential. Three, in our opinion, the main factors to be taken into consideration: artificial intelligence, China e emerging markets and prospects of the second presidency of Donald Trump in the United States “. Underlines it Richard FlaxChief Investment Officer DThe Moneyfarm Explaining that in recent years, artificial intelligence has catalyzed enormous attention and huge investments. The high expectations related to this technology are already reflected in the prices of some actions, in particular in the technological sector, but its impact could transversely influence a wide range of industries. If the reality meets expectations, it could mark a radical change in the potential of economic growth, with positive repercussions on the asset yields.
What to expect in 2025? Long -term analysis
Regarding the growth prospects of the China, which has crossed a relatively weak period of performance, a examination of the measures implemented by the Government is necessary to stimulate the economy, with a particular focus on the real estate sector, and the evaluation if they will be sufficient to encourage a sustainable economic recovery in the long run . Finally, turning his gaze to the United States, the republican victory could mark the beginning of profound political changes, affecting the main macroeconomic variables in the long run. Changes in duties, regulation and Tax rates Pthey would have influenced growth and inflation globally, while an increase in tax deficit could help keep bonds high for a longer period. The potential implications of these dynamics are complex e rich in shades.
The golden ride of artificial intelligence
The prospect of a New industrial revolution and the consequent optimism reflected in the markets, led to one of the greatestgold races nShe history of capitalism. To justify such a huge investment, the IA will have to keep two promises that will measure themselves on corporate profits: the first is that a progressive integration into the corporate systems genres an increase in productivity; The second is that the infrastructures built actually facilitates the development of innovative products and services capable of finding applications in different industries. For the moment, large numbers come mainly from the technological giants, which are massively investing in the future of the AI, also strong in the large liquidity reserves they have accumulated over the years.
The Seven big tech American represent almost 35% of the market capitalization of the’s & P 500 and have contributed to over 70% of returns since the beginning of 2023. The question is that the new generation systems require exponential investments to be trained, potentially limiting the return on investment, and to continue To see an improvement in the functioning of the models, quality data are needed that could be difficult to find. A further challenge concerns energy costs, which could become increasingly onerous as technology evolves and its use becomes more widespread.
For the moment “It’s still early to understand Which companies will be able to bring artificial intelligence products or services to the market capable of revolutionizing its reference market, but it is likely that the new innovation cycle linked to the AI will come from sectors such as pharmaceutical, telecommunications or robotics . We believe that starting from 2025 we will begin to see the IA everywhere, a global trend that will extend over the years. In Moneyfarm we believe that artificial intelligence can become one of the major growth accelerators of economic history and represents an important opportunity for investors in the coming years “.
China and emerging markets: new map of global trade
The commercial policy of Donald Trump “It could deeply redesign the International trade map And the strength relationships between emerging economies, pushing nations to review their economic and political strategies. Despite the recent attempts of these states to consolidate their political weight, increasingly marked economic divergences emerge. The new direction impressed by Washington, intended to inaugurate an unprecedented season of commercial diplomacy, could not only deepen these divisions, but also represent a real choice of field for many nations “.
The expert emphasizes that the CinA is preparing to reverse the slowdown of the growth and prices that is risking to get bogged down its economy. The dynamic has started for a few years now and has been triggered by the excessive debt and the crisis of the real estate sector. The renovation of the debt represents a sort of rescue, designed to definitively deal with one of the chronic problems of the economy.
However, the question remains openor if he really manages to hit this goal. The economic policy guidelines for the 2025 They leave the door open to a further tax expansion, with the aim of stabilizing the real estate market, increasing investments and stimulating consumption, but they will have to deal with the commercial tensions that customs duties could acute. Beijing exports to other markets will be necessary to evaluate how much exports can compensate for losses in exchanges with the United States and Europe. The direct and indirect effects of the new commercial policy would not end with China, but could concern all emerging countries, potentially redesigning the map of global trade. One of the main winners in the new commercial structure could be India, whose economy is going through a very positive phase. The country, thanks to its enormous production and industrial capacity, could be one of the main beneficiaries of the phenomenon that would see the Chinese manufactures affected by the dark duties supplanted. Relations between United States and India They strengthened considerably in the period between the first and second mandate of Trump, during which the country grew and gained a place of ever greater importance in the international economic chessboard: India is now among the first 10 commercial partners of the States United.
Trump’s return: the economic challenges of Maganomics
The US elections of 2024 ended with a clear victory forR Donald Trump and for the Republican Party. The promised economic policies unfold on three main guidelines, The expert underlines: a significant cut of taxes, accompanied by a massive deregulation to relaunch growth and economy, protectionist commercial policies and an analysis and evaluation of public spending – or spending review. According to Trump and his directors, the effect of these policies should balance and lead to a lowering of public debt and state deficit. His victory brought with him a wave of optimism on American share markets, with investors who focused on potential benefits for companies. However, not all the policies proposed by Trump are considered favorable to growth. The consensus between economists and investors is that the duties (together with immigration policies) will exert a pressure up on inflation, while the tax cuts will support the profits of companies, with possible advantages for investors. From a financial point of view, it does not seem realistic to imagine that the cuts are paid for themselves, financing through the growth they will be able to generate.
“It is likely that they will determine an increase inThe deficit and inflation, cconsequent pressure on interest rates in the medium term, which could partly counterbalance the push athe equity markets. The spending review policies and cutting cutting, despite having the theoretical possibility of creating efficiencies to the extent that they help to finance tax cuts, have a recessive and deflationary effect in the short term. They could counterbalance the pressure on rates and inflation, but also to dampen economic growth. Infine, Trump has proposed a softer regulation for mergers and for the oil and gas industry that should encourage growth, increase the trust of the companies and benefit specific sectors such as oil and financial. The effects on the broadest economy, however, would be difficult to predict. The measures are designed to compensate, implement them in a wrong sequence would risk sending ambiguous signals to the market “.
The expectations- concludes the expert- are for a growth of theeconomics, inflation and deficit. In the long term, the maintenance of this budget will be a relevant factor for the trend of global share markets, both for its direct consequences and for the effects on the Politics of the Federal Reserve. If on the one hand concerns about the deficit and monetary policy persist, on the other, trust in the American economy, in its system and in its companies (which are guiding key innovations such as artificial intelligence), It pushes to look to the future with optimism.
