Situation Assessment & Outlook for the next six months
Our short-term assessment of the development of the financial markets and asset classes.
Review - Q3 2025
While US President Donald Trump's announcement of import tariffs in April caused considerable uncertainty on the financial markets, there were no major disruptions after they were introduced at the beginning of August. Supported by extensive EU investment programmes, there were increasing signs of an economic recovery in Europe. In the US, however, growth momentum slowed.
To counteract this, the US government passed a package of legislation providing tax relief for individuals and businesses. The US Federal Reserve responded to the rise in unemployment, among other factors, by cutting its key interest rate by 0.25%. The bond markets recorded further gains in the third quarter of 2025, continuing the positive trend for the year. The stock markets also performed well overall, with regional differences. While the emerging markets and the US confirmed their good results from the second quarter, shares in German and Swiss export companies were weighed down primarily by the weak US currency and the resulting strength of the euro and Swiss franc.
As in the first quarter of 2025, gold rose again by double digits. The main drivers were the ongoing geopolitical uncertainty and the US government's expansionary fiscal policy, which carries the risk of increasing public debt. The performance of the US dollar in 2025 reflects the continuing loss of confidence in the US. Although the currency markets calmed down slightly in the third quarter, the US dollar recorded a loss of more than 12 per cent against the euro and Swiss franc over the year.
Current situation assessment & outlook for the next six months
From a global perspective, economic growth is continuing at its historical average. The stable development in emerging markets, increasing momentum in Europe and the US government's economic stimulus measures are having a positive effect. Stable inflation rates, low interest rates in Europe and further interest rate cuts in the US are providing additional support. Long-term interest rates are expected to be close to 0% in Switzerland, above 2% in Europe and around 4% in the US.
We see further upside potential in the equity markets. US equities continue to benefit from stable corporate earnings growth and rising demand, as investors remain cautious in their positioning. At the same time, risks remain due to high valuations and a significant deviation from the long-term trend. European equities are benefiting from the improved economic situation and rising corporate earnings. Further positive momentum is coming from Switzerland, thanks to low interest rates and a defensive sector structure, and from Germany, thanks to attractive valuations and rising investor interest. In the currency sector (euro, Swiss franc, US dollar), our indicators are currently not providing any strong signals for significant price movements.
Disclaimer - legal notice
This publication was produced by the Investment Office of the Colin&Cie Group. The information and opinions contained in this document are based on sources we believe to be reliable. However, we cannot guarantee the reliability, completeness or correctness of these sources. All information and quoted rates are only up-to-date at the time of this publication and are subject to change at any time without notice. The content is based on numerous assumptions made by the Colin & Cie Group. It should be noted that different assumptions can lead to materially different results. The forecasts and assessments are only current at the time this publication is prepared and can change at any time without prior notice. Past performance of an investment is not a guarantee of future results. Certain investments can experience sudden and substantial losses in value. This information and views do not constitute a solicitation, offer or recommendation to buy or sell investment instruments or to carry out any other transactions. We recommend interested investors to consult their personal advisor before making decisions on the basis of this document so that personal investment goals, financial situation, individual needs and risk profile as well as further information can be duly taken into account as part of a comprehensive consultation. The information contained in this publication is marketing material that is distributed for advertising purposes only.
