Situation Assessment & Outlook for the next six months
Our short-term assessment of the development of the financial markets and asset classes.
Review - Annual Report 2025
Despite geopolitical tensions and increasing trade conflicts, the global economy recorded solid growth in 2025, supported by lower key interest rates and expansionary fiscal policy measures. The downward trend in inflation continued: in Europe, price increases approached the central banks' target of 2% p.a. After several interest rate cuts in the first half of 2025, the European Central Bank and the Swiss National Bank reached the end of their interest rate reduction cycle. Despite higher inflation figures, the US Federal Reserve made three interest rate cuts from autumn onwards to stimulate the domestic economy. Long-term interest rates fell slightly to around 4% p.a. in the US, while remaining stable at around 2.5% p.a. in the eurozone. In Switzerland, they hovered just above 0% p.a.
The stock markets performed very well in 2025, with double-digit gains, with emerging markets significantly outperforming Europe and the US after several years of weakness. Gold remained in demand as a safe haven in the face of geopolitical uncertainties and economic risks, reaching all-time highs. The foreign exchange market was characterised by a significant weakness of the US Dollar. Expected interest rate cuts by the Fed, uncertainties about future US government spending and a loss of confidence in the US following Liberation Day in early April 2025 led to the US Dollar losing around 13% of its value against the Euro and the Swiss Franc – the sharpest decline since 2017.
Current situation assessment & outlook for the next six months
Global economic growth will continue to be robust in the coming months. Inflation rates will remain at their current level. Given the improving economic situation in Europe, no further interest rate cuts are necessary there for the time being. In the US, however, we expect a further cut in key interest rates due to the weakness of the labour market. No significant changes are expected in long-term interest rates.
Despite three consecutive years of above-average returns on the stock markets, our indicators continue to signal upside potential, even though the risks of a correction have risen again, particularly in the US. US equities should benefit from moderate investor sentiment and be supported by robust earnings growth. In Europe, improved economic sentiment and rising investor interest, among other factors, have a positive impact on the markets. Emerging market equities, which generated the highest returns of all equity segments worldwide last year, are supported by strong momentum and attractive valuations. The upward trend in the price of gold is likely to continue in the longer term. Although the ten-year period shows some exaggeration, the 30-year trend indicates additional potential. With regard to the foreign exchange market, our indicators do not provide any evidence of significant fluctuations in the exchange rates between the Euro, Swiss Franc and US Dollar.
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.
