Uncertainty reigns: The market outlook at mid-year

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Jun 30, 2025

Fabio Bassi, Head of Cross-Asset Strategy at J.P. Morgan, and Jay Barry, Head of Global Rates Strategy, delve into the current economic landscape. They discuss the enduring uncertainties shaping the market, including trade tensions and fiscal policies. The impact of rising U.S. tariffs on global growth and inflation is analyzed, alongside the resilience of corporate markets. Additionally, they explore the outlook for emerging markets amid geopolitical risks and the stabilization of oil prices, highlighting investor opportunities and challenges for the second half of 2025.

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INSIGHT

U.S. Economic Resilience Amid Risks

The U.S. economy has shown resilience in early 2025 despite many uncertainties.
There is about a 40% chance of recession in the U.S. in the second half of 2025 due to tariffs and global tensions.

INSIGHT

Tariff Effects on Economy

Tariffs impact the economy by front-loading activity, acting as a tax, and depressing business sentiment.
The tariff cost is spread broadly, moderating the immediate impact on consumer prices and spending.

INSIGHT

End of U.S. Economic Exceptionalism?

U.S. economic 'exceptionalism' is likely fading, with tariffs and immigration losses hindering growth.
Reduced government size and support for investment will weigh on future economic performance.

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Will uncertainty continue to shape business cycle dynamics? How might trade tensions, fiscal policy and geopolitical risks play out? And will there be lasting damage to markets and the economy? Join J.P. Morgan Research analysts as they explore the outlook for the second half of 2025.

In this episode, we hear from:

Bruce Kasman, chief global economist
Bhupinder Singh, U.S. equity strategist and head of Thematic Research
Jay Barry, head of Global Rates Strategy
Meera Chandan, co-head of Global FX Strategy
Natasha Kaneva, global head of Commodities Research
Stephen Dulake, co-head of Fundamental Research
Jonathan Goulden, head of EM Fixed Income Strategy
Fabio Bassi, head of Cross-Asset Strategy

This episode was recorded between June 23 and June 26, 2024.

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