Tariffs and Inflation Top Concerns for Global Markets in 2025
A recent survey by JPMorgan Chase reveals that traders anticipate tariffs and inflation to exert a profound impact on global markets in 2025.
Inflation and Tariffs Dominant Concerns
Over half (51%) of the 4,233 respondents identified inflation and tariffs as key factors poised to shape markets this year. This is a significant increase from 2024, where only 27% expressed concern about inflation.
The ongoing trade disputes, fueled by U.S. President Donald Trump's threats of tariffs on foreign imports, have already triggered market volatility. Stock indexes initially plummeted following Trump's announcement of hefty tariffs on Mexico and Canada, only to rebound after he delayed the Mexico-Canada tariffs.
Volatility Remains a Primary Challenge
Despite concerns about a potential recession receding, volatility remains a major challenge for traders. This year, 41% cited volatility as the top hurdle, compared to 28% in 2024.
The timing of volatility this year is characterized by sudden fluctuations in response to news headlines surrounding the administration's trade policies. This has led to erratic market reactions.
Electronic Trading on the Rise
The survey also highlights a growing trend towards electronic trading. Traders predict an increase in electronic trading across all products, including emerging market rates, commodities, and credit spreads.
Market Structure Concerns
Traders expressed concerns about various aspects of market structure, particularly:
* Access to liquidity
* Regulatory changes
* Market data access and costs
These findings indicate that traders are navigating a complex and evolving market environment in 2025, where tariffs, inflation, and volatility remain key factors.