Global uncertainty due to US tariffs continues to prevail at record-high levels. This may lead to a synchronised decline in the economic cycle in both developed and emerging markets. (Source: Allianz)
On 7 August, the Bank of England cut its base rate to 4.0%. Further reductions are expected if inflation softens. (Source: Forbes)
The Bank of England is expected to continue its gradual easing cycle in 2025. (Source: Allianz)
According to Allianz Research’s mid-year economic outlook, global growth is expected to remain sluggish at +2.5% in 2025, the slowest since 2008 outside of recession periods. (Source: Allianz)
Investors have pulled back from the US, contributing to a notably stronger euro despite relatively less attractive returns (e.g. lower yields or geopolitical uncertainties). So far in 2025, the euro has risen by more than 10% against the US dollar, supported by capital flows away from the US and into European assets. (Source: Allianz)
Real wage growth has been dynamic and has helped to support a recovery in household spending. (Source: Allianz)
The labour market shows signs of normalisation with layoffs expected as companies focus on efficiency and cost cutting. (Source: Allianz)
Five-year fixed mortgage rates remain around 5%, with limited movement expected for the rest of 2025. Market forecasts now suggest only one further base rate cut this year, making any sharp drop-in mortgage rates unlikely before 2026. (Source: MoneyWeek, Reuters)
Retailers continue to pass on the cost of wage hikes and higher taxation to the consumer, which is disproportionately impacting families with tighter budgets. (Source: Savills)
