Investment update - April 2025
read
Published on 26 May 2025In April 2025, global markets remained volatile as the effects of US President Donald Trump’s surprise tariff announcements from March continued to unfold. The US introduced a 90-day pause on implementing new tariffs, which helped ease investor concerns and saw the S&P 500 recover losses by early May. Despite this, US economy showed signs of strain, with Q1 US GDP contracting by -0.3%, with rising imports and weakening consumer spending contributing to the decline. Inflation eased, but the Federal Reserve held interest rates steady, citing concerns about future inflation from tariffs.
In Australia, the ASX 200 rose 3.6% as investors rebalanced away from US equities. The Reserve Bank of Australia held rates steady at 4.1% since its February 2025 meeting, taking a cautious approach and wanting to see inflation moderate further to well within its target bands before resuming its easing cycle.
In Europe, the ECB cut rates by 25 basis points to 2.25%, responding to weak growth and persistent inflation. The Bank of England also cut rates to 4.25%, with further cuts expected. Consumer confidence declined across both regions, though retail sales remained resilient.
In China, economic indicators softened, with deflation (-0.1% CPI) and declining PMIs, however, Chinese authorities are already responding with a range of stimulus measures to counter slowing growth and rising trade tensions.