Deep Dive into Q3 2025 Market Trends
Analysis by Daniel Strohfeldt - June 23, 2025
Global Economic Landscape in Q3 2025
Global Growth Projections and
The global economic outlook for 2025 indicates a period of significant deceleration. World Bank forecasts global GDP growth at 2.3% in 2025, notable downgrade from prior expectations. This growth forecast is the slowest pace of any decade since the 1960's, excluding periods of recession. OECD echoes this sentiment; projecting global growth to slow from 3.3% in 2024 to 2.9% in 2025 and 2026. Primary forces drving the slowdown are identified as heightened trade tensions and global policy uncertainty. The consistent messaging across multiple reputable sources about global growth slowing to multi-decade lows; driven by trade tensions and policy uncertainty, suggests that current economic environment is not merely a cyclical downturn. These analyses imply that businesses and governments adapt to a prolonged period of lower growth potential and increased volatility, leading to higher costs and less optimal global resource allocation as traditional efficiency-focused strategies. Regional variations in the global outlook are pronounced. EMDE (emerging markets and developing economy) regions face a difficult path, with downgraded growth forecasts. For low-income countries growth is projected to rise to 5.3% in 2025, which is a highly optimistic outlook heavily contingent on de-escalation of global conflicts and a moderation of inflation in certain nations. East Asia and Pacific region including China is projected to see growth slow to 4.5% in 2025. Europe and Central Asia are projected to slow to 2.4% in 2025, primarily due to the Russian slowdown of economic activity. Middle East and North African region is projected to strengthen to 2.7% in 2025, driven by an expansion of oil activity in oil-exporting nations. Sub-Saharan Africa's growth is forecast to increase to 3.7% in 2025.
Global Inflationary Pressures
United States Economic Outlook for Q3 2025
GDP Growth and Economic Indicators
Inflation Dynamics and Federal Reserve Policy
Labor Market Performance
Global Inflationary Pressures
Resiliency in the Technology Sector
GDP Growth and Economic Indicators
Inflation Dynamics and Federal Reserve Policy
Labor Market Performance
Sector Performance Breakdown
While the overall market saw modest gains, the performance varied significantly across different sectors. The technology sector, once again, led the pack.
Q1 2025 Sector Performance (%)
Conclusion & Outlook
In conclusion, the first quarter has set a dynamic tone for 2025. While caution is advised given the global economic climate, the strong performance in key sectors provides a solid foundation for optimistic investors.