Rates are falling, AI is rising: are we ready for 2025?

Summary of an article by Kliment Robev

In brief

In his annual review, Kliment Robev looks back at a turbulent 2024 in financial markets and sets out the main themes and risks for 2025.

Key points

1. 2024 began with hopes that high inflation was ending, and in the second half the Federal Reserve and the ECB started cutting rates.
2. In early August the unwinding of “carry trades” knocked Japan’s Nikkei down 12% in a single day and hit tech stocks, but the losses were quickly recovered.
3. Memorable events: record highs in US indices led by the “Magnificent Seven” and Nvidia; bitcoin close to $100,000; gold at an all-time high despite a stronger dollar.
4. The themes for 2025: central bank policy, the return on huge AI investments, and geopolitics — wars, peace, tariffs.
5. The main risks: pro-inflationary policies under Trump slowing rate cuts; AI regulation cooling profit expectations; a deepening trade war. A long-term view and patience remain the investor’s best allies.

Context

Published on 6 December 2024, a month after Donald Trump’s election victory and at the end of a year of record highs in US indices.

Views reflect his position at the date of publication and are not investment advice. Regulatory information