Key Convictions: Second quarter 2025

Investment landscapes are shifting as recent trade policies and geopolitical developments contribute to heightened market volatility. While fixed-income returns are diverging, with US and emerging market bonds performing well against the backdrop of underperforming Japanese and eurozone government bonds, the overall outlook remains positive. Strong global yields, coupled with central banks' readiness to adjust rates, offer a stabilizing influence despite policy uncertainties.

Investors should remain vigilant as economic growth continues to show resilience in consumer activity globally, while inflation trends align closely with central bank targets despite unique challenges in the US due to tariffs. This environment underscores potential opportunities within credit markets where strong fundamentals may lead high-yield sectors towards more promising valuations amidst ongoing volatility.