Global money managers are scaling back risk or rebalancing portfolios amid an expanding global trade war and an increasing likelihood of a sharp slowdown in US economic growth. Economist Ed Yardeni has raised the probability of a stagflation scenario to 45%, warning of a possible recession, and assigned similar odds to a deepening US stock market correction.
A roller-coaster quarter for markets is ending with little relief, as President Donald Trump’s disruptive trade policies and rising stagflation fears drive investors toward risk aversion.
Stocks tumbled in Asia on Monday, with a gauge of global equities set for its worst quarterly performance since September 2023. Amid a search for havens, a Bloomberg gauge of US government bonds has risen 2.6% year-to-date, while gold continues to hit fresh records.
