The US economy is "fundamentally very strong"
According to Grace Peters - Head of Global Investment Strategy at JPMorgan, although inflation tends to increase again and new policies are being implemented, the US economic growth outlook in 2025 is still very positive. Grace Peters believes that investing in gold and infrastructure stocks will help reduce risks.
“There is clearly a return to inflation risk. I think that is a yellow light, not a red light. But we have seen signs, not only in the recent three-month uptrend in the core PCE price index, but also in rising consumer inflation expectations.”
She stressed that inflation cannot be assessed in isolation, but must be viewed in relation to other factors. “It is a question of growth and inflation combined. When you look at the growth trajectory that the next administration will inherit, it is a very solid foundation.
We are currently seeing real GDP growth in the US between 2% and 2.5%, and that could be sustained for the next six months, even through 2025. So we still feel the US economy is fundamentally very strong."
Strengthening the portfolio
JPMorgan (an American multinational financial services corporation) has just released its 2025 outlook report titled “Building on a Solid Foundation”. Commenting in this report, Peters said that the goal for next year is to consolidate strong investment positions while minimizing both new and old risks.
“We have had two strong years of growth in risk assets, so the key theme we want to emphasize is to strengthen the resilience of the portfolio, which means aligning with the baseline scenario while managing the potential risks. These risks include higher inflation, the possibility of weaker growth."
Asked about how JPMorgan would approach the U.S. policy environment as the new administration takes office, Peters said there are too many unknowns to draw firm conclusions.
“This raises the question: What does a sustainable portfolio really mean in the current environment? Policies are still very vague. We can only guess at their effects on growth and inflation.
Therefore, strengthening the resilience of the portfolio is very important. Investors should continue to hold their investments. We believe that the growth outlook for the next 12 months, as well as the medium term, is very positive. However, inflation risks, geopolitical risks and risks related to budget deficits still exist. Therefore, adding investment in infrastructure and gold are two effective ways to strengthen the resilience of the portfolio."
Diversify your portfolio and expand your global investments
On equities, JPMorgan recommends clients diversify their investments, Peters said. “Another important theme for us is investing in capital, whether it’s in the AI transition or in energy and security needs. All of these factors are driving GDP growth trends, but more importantly, they’re driving growth in the equity market.
"Spread your investments globally, diversify your portfolio, hold your investments, but add protective elements like infrastructure and gold," she concluded.
