SINGAPORE, Jan. 8, 2025 /PRNewswire/ -- Citi Wealth recently released its full-year Wealth Outlook for 2025 – Growth Amid Discord: Strategies for a "Rule-Breaking" Expansion. The report offers detailed perspectives on the global economic, market and geopolitical landscape ahead, including insights on Asia looking at key topics involving China, India and Japan.
Having defied usually reliable recession signals, the global economic expansion is expected to continue in 2025 and 2026. Citi Wealth forecasts world GDP to rise 2.9% in 2025 and 2026, up from 2.6% in 2024, with the U.S. remaining the primary growth engine. Forecasted U.S. growth for 2025 has also been updated to 2.4%.
"We are advising our investors to keep core portfolios fully invested for the long-term while being wary of over-concentrated portfolios," said Steven Wieting, Chief Investment Strategist and Economist for Citi Wealth. "The long period of sharp outperformance for U.S. large cap equities has reduced future returns while many other assets – including smaller cap U.S. growth and international markets – offer potential opportunity."
In Asia, India, East Asia AI-exposed markets and Japan equities could prove attractive.
Ken Peng, Head of Asia Pacific Investment Strategy, Citi Wealth, said, "Opportunities still abound in Asia. Strong domestic demand in India and progress in reflation and reforms in Japan will drive continued growth there. As global trends like AI continue rolling out across industries, markets like South Korea and Taiwan are well-placed to address infrastructural needs and future upgrade cycles."
Amid likely geopolitical discord, Citi Wealth expects greater market volatility. The Trump administration is projected to pursue policies that prioritize domestic activity and that may stoke tensions internationally. Risks include policies over trade and immigration, their impact on inflation and growth, and pockets of high valuation.
"With systemic trends powering global economic growth in 2025 and beyond, investors have reason for optimism," said Andy Sieg, Head of Citi Wealth. "At the same time, discord around the world can threaten market stability. With so many variables to consider, it's important that investors have advisors they can rely on."
In the report, Citi Wealth also examines four unstoppable trends, powerful long-term forces that are transforming how we live and work:
- AI: Getting More Real - Spending on AI capacity continues to increase worldwide. AI adoption has, to date mostly benefited the tech sector, but benefits may now spread. Citi Wealth identifies healthcare, finance, robotics, education and agriculture among potential beneficiaries, although slower-than-expected business outcomes remain a risk.
- Climate: Investing in Innovative Technologies - Extreme weather events have underlined the need for further action to address climate change, including emissions reduction, carbon capture and adaptation. Citi Wealth favors exposure to makers, installers and users of innovative technologies in these areas.
- Healthcare's Prescription for Longevity – Aging populations are straining healthcare budgets worldwide, so trying to keep people healthier for longer is vital. Citi Wealth believes specialist healthcare managers have investment potential.
- Positioning Portfolios amid U.S.-China Polarization: The strategic rivalry between the U.S. and China may intensify under the Trump administration. As the "G2" powers seek to strengthen their supply chains, certain industries in Southeast Asia, Latin America and the U.S. stand to gain.
In addition, Citi Wealth highlights 10 opportunistic positions that it believes may complement core portfolios, depending upon investor objectives:
- Semiconductor equipment makers
- Medical equipment
- Biotechnology
- Defense contractors
- U.S. banks
- Midstream energy transportation
- Nuclear energy
- Positioning for renewed volatility
- Enablers of cryptocurrencies' growth
- Brazilian equities
About Citi
Citi is a preeminent banking partner for institutions with cross-border needs, a global leader in wealth management and a valued personal bank in its home market of the United States. Citi does business in more than 180 countries and jurisdictions, providing corporations, governments, investors, institutions and individuals with a broad range of financial products and services.
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