By Eddah Waithaka
Standard Chartered unveiled its Global Market Outlook for the second half of 2025 today, forecasting a constructive but volatile environment for investors worldwide.
The Bank expects emerging markets, including Africa, to benefit from a softer US dollar, resilient global equities, and improving prospects for emerging-market assets.
Mixed Global Macro Conditions
The report highlights divergent trends across key economies. The US is sustaining growth momentum driven by strong consumption and fiscal stimulus, although trade and policy uncertainties might hinder progress later in the year.
Europe benefits from fiscal easing but continues to grapple with structural challenges.
China’s economy is stabilizing as targeted stimulus measures and improving retail activity take effect. Meanwhile, India and the ASEAN region are on a steady growth path, bolstered by robust domestic demand.
Positioning for a Weaker Dollar
With the US dollar expected to weaken over the next 6–12 months, Standard Chartered has upgraded Asia ex-Japan equities and EM local-currency bonds to Overweight.
Global equities also retain an Overweight rating, supported by strong earnings, easing trade tensions, and controlled inflation.
Historically, a weaker dollar boosts risk assets, particularly in emerging markets. The report suggests that EM investors are well-placed to capitalize on these shifts.
The Bank recommends a focus on USD-denominated bonds with a maturity of 5–7 years for their attractive risk-adjusted returns, while downgrading Developed Market Investment Grade bonds to Underweight due to tight yield spreads.
Additionally, Gold is emphasized as a core hedge in the current environment, bolstered by strong central bank demand and the diminished downside protection offered by bonds.
Expert Insight
Manpreet Gill, CIO for Africa, Middle East, and Europe at Standard Chartered, said, “This is a pivotal moment for EM investors. As the dollar weakens and central bank policies diverge, diversifying into EM bonds and non-US equities can help navigate volatility and enhance portfolio resilience.”
With global markets entering a new phase, Standard Chartered’s outlook highlights opportunities for investors to reposition strategically amid shifting dynamics.
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