Geopolitical factors had already moved the markets in 2024. The financial markets could also face shocks from this direction in 2025. What black swans the analysts at BCA Research are predicting.
• BCA Research analysts forecast geopolitical shocks for 2025
• Potential market impact from events such as China’s policy change or a nuclear deal
• Possible shock factors such as the USA leaving NATO or military tensions in Mexico
Events that are difficult or difficult to predict, but which have serious consequences when they occur, are also called “black swans”. The experts at BCA Research have identified the same for 2025 on a geopolitical level. Experts believe the events have shock potential.
China is making a U-turn
Analysts see such a potential shock result as a result of a possible change in economic policy in China. The government in Beijing could revive its offshore domestic and foreign stock markets if it pursues more aggressive government spending and market-friendly reforms and adopts a less confrontational stance toward the West. This could serve as an important catalyst for global markets, “Investing.com” quotes from a customer note from BCA Research.
In particular, possible negotiations to revive trade could at least defuse the tariff scenario threatened by Donald Trump’s inauguration.
Nuclear deal between the USA and Iran
According to analysts, another black swan would be a nuclear deal between the United States and Iran. During Donald Trump’s first term in office, the USA shelved the nuclear treaty between the two powers. If this agreement is revived, oil prices could fall significantly as the supply risk would be lower in this context. In addition, the risk of a military conflict between the USA and Iran would also decrease, the probability of which the BCA estimates at 75 percent for 2025, according to “Business Insider”. “A black swan would be Trump’s team, which … negotiates a deal with Iran to freeze its nuclear program and thus prevent an all-out war,” the strategists are quoted as saying.
NATO in the future without the USA
The Republican made it clear before he took office that US President-elect Donald Trump was not satisfied with the current dynamics in the North Atlantic Treaty Organization (NATO). Trump turning his back on NATO would be another potential shock to markets, according to BCA Research. Trump had already considered withdrawing from the agreement during his first term in office. If he actually implements this step or at least refuses support in the event of an alliance, this could “undermine trust in the alliance,” “Business Insider” quotes the experts as saying. The consequences of such a shock would be enormous: Russia could consider military involvement in Eastern Europe, and currencies and assets in the region would be severely affected. In such a case, the euro would also come under pressure, the strategists continued.
Military action against Mexico
A black swan impact on the American continent would be military action by the United States on its southern border. Not only would this likely lead to economic tensions with Mexico, which could result in a tariff war between the two countries and result in a sharp increase in prices in the USA, experts also believe that retaliatory measures, for example from drug cartels in the USA, are possible , which would lead to a security crisis.
Fight against the all-powerful dollar
Analysts see a possible coordinated foreign exchange intervention as another geopolitical event that could send shockwaves through the markets. If large economies decide to jointly declare war on the strong greenback in order to react to tariff effects that have caused an imbalance, this is likely to significantly weaken the US dollar. “Trump’s faction would rather apply political and strategic pressure to encourage other countries to pay the price of the macro adjustment by revaluing their currencies or taking actions that increase U.S. imports,” the company wrote. “This would have an extremely negative impact on the greenback this year,” according to the customer note from Business Insider.
Editorial team finanzen.net