What do you need to know?
The global economy is set to hold steady amid a complex economic backdrop, according to AXA IM’s 2025 Outlook. Overall, we expect global growth will remain at 3.2% in 2025 but then ease to 2.9% in 2026. US President-elect Donald Trump’s radical policy agenda has fuelled some financial market uncertainty, but we believe the central macroeconomic outlook remains favourable – for now, we don’t expect a material slowdown in 2025 which should help deliver positive equity returns, while credit markets should provide attractive income opportunities. Ultimately, growth, stable inflation and lower interest rates should support markets.
Around the world
Eurozone business activity fell to a 10-month low in November, reflecting a renewed decline in services output, according to the latest Purchasing Managers’ Index (PMI). The composite PMI, which includes manufacturing and services data, fell to 48.3 from October’s 50 – a reading below 50 indicates contraction. Last week political disruption in France created further uncertainty, as Prime Minister Michel Barnier resigned after a no-confidence vote. Elsewhere, US business activity rose to a 31-month high in November, in part because the presidential election outcome removed uncertainty and prompted customers to commit to new orders.
Figure in focus: $100,000
The price of bitcoin rose to a new high, surpassing the US$100,000 mark for the first time on Wednesday. The cryptocurrency’s value soared after it emerged that Trump plans to nominate Paul Atkins to lead the Securities and Exchange Commission (SEC), the Wall Street regulator. It is anticipated that Atkins, a former SEC commissioner and supporter of cryptocurrency, will regulate digital currency in a more accommodative manner. Bitcoin’s value has a volatile history and previously Trump had been dismissive of cryptocurrencies but has since pledged to make the US “the crypto capital of the planet”.
Words of wisdom
Cyber 5: The five-day period between US Thanksgiving and Cyber Monday, which includes Black Friday – a key sales period for retailers which offer significant discounts. Consumers spent $41.1bn online over the period, an 8.2% increase on the same period the year before, according to Adobe Analytics. That included spending on Black Friday of $10.8bn, up 10.2%, and $13.3bn on Cyber Monday, a 7.3% increase. Notably, the analysis found that on Cyber Monday, 57% of online sales came via a mobile device, representing a spend of $7.6bn, a year-on-year rise of 13.3%.
What's coming up?
Monetary policy will dominate much of the week ahead. The Reserve Bank of Australia meets on Tuesday to decide on interest rates, while the Bank of Canada and European Central Bank (ECB) hold their own meetings on Wednesday and Thursday respectively. Given the current backdrop in Europe, markets will be paying close attention to the ECB’s decision and rhetoric; in October it cut its key interest rate to 3.25%. Elsewhere in terms of economic updates, China issues new inflation data on Monday while the US follows with its own numbers on Wednesday.