Richard Bonnor-Moris

The macroeconomic outlook for March 2025 highlights a mix of risks and opportunities. The U.S. faces rising recession risks due to weakening consumer spending, stagnant wage growth, and persistent inflation, exacerbated by uncertain trade and immigration policies under the Trump administration. Federal spending cuts and restrictive monetary policies further strain growth, with GDP projected to slow to 1.6% in 2025. However, improving market valuations and Europe’s bold fiscal expansion, including Germany’s €900 billion defence and infrastructure plan, offer hope. These measures aim to counter sluggish growth and could position Europe as a relative outperformer. While remaining tactically underweight risk, the outlook suggests a potential shift toward neutrality if U.S. valuations improve or Europe’s stimulus continues to gain traction.

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