Outook 2025: Joost van Leenders (Van Lanschot Kempen Investment Management)
Outook 2025: Joost van Leenders (Van Lanschot Kempen Investment Management)
This text was originally written in Dutch
By Joost van Leenders, Senior Beleggingsstrateeg, Van Lanschot Kempen Investment Management
Where are the biggest opportunities and threats for 2025?
'For 2025, we foresee a growing global economy. Falling inflation and interest rate cuts by central banks are positive. The US is heading for a soft landing, with inflation falling while the economy continues to grow. In Europe, consumers in particular have room to spend more. We do not foresee exuberant growth. In the US, the economy is close to its limits and in Europe, governments will cut spending on balance. We think the Chinese government will manage to stabilise the economy, but do not foresee a fiscal growth impulse. We see opportunities in equities, where returns will be driven more by earnings growth and less by higher valuations than in 2024. We think government bonds are reasonably discounting the prospects of interest rate cuts by central banks.
Consequently, returns will have to come mainly from coupon yields. We find risk premiums especially low in US investment grade corporate bonds and high yield corporate bonds in general. Within bonds, we have a relative preference for European investment grade corporate bonds and, to a slightly lesser extent, emerging market bonds.
Political risk comes mainly from the US. Tax cuts by the new administration could have an inflationary effect. This is negative for bonds, but could also hurt expensive US equities. For equities from Europe and emerging markets, higher US import tariffs are a particular risk. Noting that Europe is better prepared for an aggressive US trade policy and may be able to avoid a trade war through negotiations.'
We do not foresee exuberant growth.