Download the Full Report
*Hover to reveal more
Sources: Bloomberg L.P., International Monetary Fund, National Sources, and Thomson Reuters Datastream.
Note: Numbers in parentheses reflect the 20-year annualized growth rate through the end of 2023.
China
Eurozone
Growth Rate
0.6%
Inflation Rate
2.7%
United Kingdom
Growth Rate
0.4%
Inflation Rate
3.1%
Japan
United States
As of November 30, 2024 • Bloomberg Consensus Estimates for 2025
Expected Rates of Real Economic Growth and Inflation in Key Markets
Our investment views are guided by our expectation that global growth will likely remain close to trend in 2025. The consensus expectation is for global growth to grow 3.1% next year, which is the same rate of growth that is anticipated in 2024 and in line with the trailing 20-year average rate of growth of 3.0%. While global growth could slow modestly from these levels, the risk of a global recession remains low, and we do not expect growth will fall materially below its long-term trend. We expect inflation rates in most major economies to experience a bumpy deceleration toward central bank targets, as near-trend growth helps ease price pressures that remain elevated in some cyclical, service-oriented sectors. In our view, this will allow most key central banks to continue modestly easing policy rates next year, which will move rates closer to their long-term neutral rates of interest.
Our economic outlook is based on three major drivers. First, consumer spending growth will likely slow (United States) or remain low (major non-US developed markets), given the depletion of any remaining pandemic-era excess savings in the United States and cooling labor markets across developed markets. Second, the manufacturing sector will remain under pressure due to the lagged effects of tight monetary policy as well as cyclical and structural headwinds in China and the euro area. Third, although lower DM policy rates and stimulative policies in China may help limit downside risks to economic growth, the impact will not be substantial enough to materially boost growth above its long-term trend. Beyond these three major drivers, the results of the US presidential election contribute to global economic uncertainty, broadening the range of possible economic outcomes.
The Global Economic Backdrop in 2025
Brazil
Inflation Rate
4.0%
(5.7%)
Growth Rate
(2.2%)
2.0%
Inflation Rate
(2.6%)
2.4%
Growth Rate
(2.1%)
2.1%
Inflation Rate
(2.8%)
2.4%
Growth Rate
(1.3%)
1.4%
Inflation Rate
(2.1%)
2.0%
Growth Rate
(1.2%)
1.2%
Inflation Rate
(2.4%)
1.1%
Growth Rate
(8.0%)
4.5%
Inflation Rate
(0.6%)
2.0%
Growth Rate
(0.6%)
1.2%
Canada
Inflation Rate
(2.2%)
2.0%
Growth Rate
(1.9%)
1.8%
India
Inflation Rate
(6.4%)
4.7%
Growth Rate
(6.5%)
6.8%
Australia
Inflation Rate
(2.7%)
2.8%
Growth Rate
(2.5%)
2.0%
Download the Full Report
Learn More
We expect the US dollar rally will ultimately cool, with early strength giving way to modest weakening. Meanwhile, gold returns are likely to moderate in 2025 after a surge in 2024. Emerging markets' use of stablecoins should support positive crypto returns, driving blockchain innovations and investment opportunities.
Currencies
Learn More
We expect public infrastructure equities to perform similarly to developed market equities in 2025, propelled by supportive regulations for energy transition and strong demand for power infrastructure to fuel AI. While we believe US REITs should underperform US equities, US private real estate funds raised in 2025 should generate above-average returns, benefiting from distressed deals and solid fundamentals.
Real Assets
Learn More
We expect liquid credit returns to decline due to low credit spreads and anticipated Fed easing. Direct lending returns should moderate but continue to outperform their liquid counterparts. Meanwhile, insurance-linked securities will continue to benefit from strong demand, and increased transaction volumes should support both specialty finance and credit opportunities managers. In emerging markets, currencies should become a tailwind for local bonds.
Credit Markets
Learn More
We expect California Carbon Allowances (CCAs) to recover from 2024 losses as clarity on supply reductions emerges. Meanwhile, impact private investment flows will favor strategies with faster distributions and commercial validation. Additionally, headwinds for private diverse manager allocations should ease, but the overhang of emerging funds may lead to consolidation or shutdowns, challenging managers.
Diverse MAnager & Impact Investing
We expect private investment performance to improve, as the impact from over-investment in 2021–22 recedes. The asset class's long-term performance should continue to attract individual investors and managers are creating pathways for them to more easily access opportunities. While M&A and IPO exit opportunities may improve, we believe the importance of continuation vehicles as an exit path will grow. In Asia, we expect Japanese buyout and Chinese venture capital transaction activity to increase.
Private Equity & Venture Capital
Learn More
Learn More
We expect developed markets value and small-cap equities to outperform, given our economic views and their steep valuation discounts. Regionally, we believe US equity performance will not match the level set in 2024, allowing European, Japanese, and emerging markets equities to perform more in line with broader developed markets. Within emerging markets, strong Indian equity gains should moderate, while we doubt Chinese equities will collapse. At the same time, we expect long/short equity strategies will perform better than typical.
Public Equities
We expect most major central banks to continue cutting policy rates, which should allow bonds to outperform cash. With breakeven inflation rates likely to be range bound, returns of inflation-linked and nominal bonds should be similar.
Learn More
Interest Rates
Learn More
We expect global equities to outperform bonds, as near trend economic growth should support continued corporate earnings growth and healthy risk appetite. Stock/bond correlations should be lower than the 2023–24 peak levels, even as protectionist US policy may drive global economic uncertainty higher.
Cross Asset
An Overview of Our 2025 Views
Contributors
Serge Agres Managing Director, Pension Practice
Andrea Auerbach Global Head of Private Investments
Stuart Brown Investment Director, Capital Markets Research
Marc Cardillo Head of Global Real Assets
Aaron Costello Head of Asia
Celia Dallas Chief Investment Strategist
Tiffany DiLiberto Senior Editorial Project Manager, Capital Markets Research
Sehr Dsani Senior Investment Director, Capital Markets Research
Sean Duffin Senior Investment Director, Capital Markets Research
Frank Fama Head of Global Credit Investment Group
Christina Fenton-Neblett Senior Director, Capital Markets Research
Vivian Gan Associate Investment Director, Capital Markets Research
Guillermo Garcia Montenegro Investment Associate, Capital Markets Research
Carolina Gómez Investment Director, Diverse Manager Investing
Song Han Senior Director, Compliance
David Kautter Associate Investment Director, Capital Markets Research
Grayson Kirk Senior Investment Associate, Investment Strategy Office
Graham Landrith Associate Investment Director, Capital Markets Research
Will Lawrence Partner, Private Client Practice
Liqian Ma Head of Sustainable and Impact Investing Research
Scolet Ma Senior Investment Director, Private Equity
Stephen Mancini Senior Investment Director, Hedge Funds
Joseph Marenda Head of Hedge Fund Research and Digital Assets Investing
Andres Marin Investment Associate, Capital Markets Research
Marcelo Morales Senior Director, Capital Markets Research
Wade O’Brien Managing Director, Capital Markets Research
Thomas O’Mahony Senior Investment Director, Capital Markets Research
Kristen Ouellet Editorial Project Manager, Capital Markets Research
Adam Perez Managing Director, Credit Investments
Vish Ramaswami Head of Asia-Pacific Private Investments
Jasmine Richards Head of Diverse Manager Investing
Kevin Rosenbaum Head of Global Capital Markets Research
Omar Sánchez Partner, Endowment & Foundation Practice
TJ Scavone Senior Investment Director, Capital Markets Research
Nicolas Schellenberg Managing Director, Private Equity
Mark Sintetos Investment Associate, Capital Markets Research
Caryn Slotsky Managing Director, Private Investment Strategy Research
Sharad Todi Senior Investment Director, Private Equity
Joseph Tolen Senior Investment Director, Credit Investments
Ilona Vdovina Senior Investment Associate, Capital Markets Research
Back to the top
Download the Full Report
Watch the Webinar
Watch the webinar