BANK OF E ASIA(HK:00023) Sou Hu Cai Jing·2025-09-09 02:34Core Viewpoint - The report highlights a significant adjustment in the global economic and political landscape in the first half of 2025, with trade relations and geopolitical changes causing volatility in financial markets. Despite some positive developments in US-China trade relations and the end of the Iran conflict, key issues such as tariff policies and the implications of the "One Big Beautiful Bill Act" remain uncertain [1][2]. Macroeconomic Strategy - The ongoing tariff war, de-dollarization, and demand for gold as a safe haven will continue to impact the market. The uncertainty surrounding the Trump administration's policies and the Federal Reserve's monetary policy may lead to fluctuating market sentiments and investment emotions [1][2][24]. Macroeconomic Outlook - Global economic growth is expected to slow to its lowest point since the post-pandemic recovery, with a forecasted growth rate of 2.8% in 2025, down from 3.3% in 2024. The US economy is projected to grow only 1.2% in 2025, facing pressures from policy reversals and tariff impacts. In contrast, China's economy is expected to achieve around 5% growth due to policy stimulus [2][3][61]. Stock Market Insights - The US stock market may experience short-term volatility but has long-term support, particularly in the artificial intelligence sector. European stocks are seen as undervalued compared to US stocks, offering better long-term risk-return profiles. Asian markets, especially Hong Kong and Singapore, are expected to continue their valuation recovery [2][3][16]. Foreign Exchange Market - The uncertainty surrounding US trade policies is likely to suppress the dollar's performance, although it may receive short-term support from safe-haven flows. The euro is expected to perform well in the medium to long term, while the British pound faces inflationary pressures. Various currencies, including the yen and Australian dollar, will exhibit different volatility patterns influenced by their respective economic data and policies [2][3][16]. Bond Market Analysis - The attractiveness of long-term US Treasury bonds has declined due to the US debt situation, while short-term US bonds remain a core safe-haven asset. Demand for investment-grade corporate bonds is strong, and Asian investment-grade dollar bonds are expected to perform well due to favorable fundamentals and China's easing monetary policy [3][16]. Gold Market Outlook - Gold prices are anticipated to continue rising due to strong demand for safe-haven assets and central bank purchases. The report notes that gold has seen a significant increase in price, with a year-to-date rise of 27% as of June 25, 2025. Central banks are expected to continue increasing their gold reserves, further supporting gold prices [2][49][56].