Get the latest assessments from Klaus Wellershoff in conversation with Patrick Müller.
The video is from May, 2025
The initial shock has passed. As a result, most portfolios have shown positive returns for April. However, many uncertainties regarding the future trade policies of the USA remain, and the real economic outlook is increasingly clouded. Due to the tense economic situation, we have conducted an additional liquidity check for you. Every storm can be weathered as long as liquidity planning is ensured at all times.
Economic Growth: A clouded picture, but still stable growth
The global economy remains fragile. Although China recently posted surprisingly strong quarterly figures, this development is mainly due to pre-export to the USA, which is likely to be temporary due to tariffs.
In Europe, economic dynamics remain weak, with no discernible impetus for a quick recovery, and the picture is also clouding in the USA: consumer sentiment has recently plummeted, indicating weaker private consumption, which has so far been the mainstay of US growth. Furthermore, it should be noted that no sentiment data is available since the introduction of Trump's tariffs.
Despite these signs of a global slowdown, no clear forecast of a world recession can be made based on the currently available data. The further development remains strongly dependent on the reactions of consumers and companies to the political upheavals and uncertainties.
Inflation: Globally declining inflation rates, problems in Japan
In the USA and Great Britain, the core inflation rate has recently fallen, but remains at a still high level. In Japan, on the other hand, the similarly significantly high core inflation has recently risen further to 2.9 percent. For the Japanese central bank, the dilemma between persistently rising inflation and a weakening economy, which is further under pressure from Trump's tariffs, is intensifying.
In the eurozone, inflation, especially in Germany, is increasingly approaching the target mark of 2 percent. The decline is mainly due to weak economic development and declining inflationary pressure on wages. As a result, the European Central Bank (ECB) lowered the key interest rate again in April.
In Switzerland, the core inflation rate remained at 0.9 percent. Falling domestic prices were offset by rising import prices. In view of global uncertainties and moderate price developments, the Swiss National Bank (SNB) also lowered its key interest rate again at the end of March.
Monetary Policy: The SNB still in a dilemma
While the European Central Bank (ECB) and the US Federal Reserve (Fed) continue to reduce their balance sheets, the Swiss National Bank (SNB) continues to take the opposite approach. A look at the external value of the franc suggests that the SNB is beginning to expand its balance sheet again to prevent the franc from appreciating too much against the dollar and thus support the export sector. However, this strategy is not without risk, as the SNB is already under political pressure from the USA: President Trump has accused Switzerland of currency manipulation through foreign exchange purchases in the past. This stance could intensify in light of renewed interventions, with the risk of new sanctions against Switzerland.