Situation Assessment & Outlook for the next six months
Our short-term assessment of the development of the financial markets and asset classes.
Review - Q1 2025
Driven by the expansionary fiscal policy in the US and emerging markets, the global economic environment improved slightly in the first three months of 2025. Political transitions in the United States and Germany had a major impact on the development of the financial markets.
Due to possible structural changes to fiscal programmes, higher import tariffs and the threat of trade conflicts, investor sentiment in the United States deteriorated significantly. The uncertainty among investors led to a volatile and weaker US equity market and a decline in long-term interest rates. In Germany, on the other hand, long-term interest rates rose in the hope of growth-orientated policies and deregulation.
The European Central Bank (ECB) and the Swiss National Bank (SNB) implemented further key interest rate cuts in the first quarter of 2025. The positive economic effect of key interest rate cuts from mid-2024 became increasingly noticeable in Europe with a delay of nine months and companies' profit expectations improved in a global comparison. Share prices have also benefited from this. While the US stock market posted a negative performance following two exceptionally strong years, German (DAX) and Swiss (SMI) indices delivered above-average returns.
After consolidating in the fourth quarter of 2024, gold continued its successful course. The precious metal benefited from investor uncertainty. The euro also showed notable strength, gaining against both the US dollar and the Swiss franc.
Current situation assessment & outlook for the next six months
The impact of the new trade tariffs on the economy and on inflation remains uncertain. The current indicators only cover this environment to a limited extent, which means that the informative value must be interpreted with caution. At present, the global economy is being supported by consumption in emerging markets and continued low unemployment rates in the US and Europe.
However, if the trade conflict with the US escalates further, we anticipate upward pressure on inflation — particularly in the United States. This would limit the leeway for the US Federal Reserve to cut interest rates further. In contrast, we continue to see no negative interest rate environment in Switzerland. After the recent correction in the stock markets, equities have become more attractive.
Gold is in a long-term rising trend without exaggeration. Despite the significant appreciation in recent years, broad investor interest, apart from central banks and institutional investors, has only just begun to increase. This will support the price development of gold in the future.
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.
