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In USD terms, most global bond and stock markets gained in 2025, which turned to be a very Goldilocks year: economic growth was neither strong enough to re-consider mostly accommodative fiscal and monetary policies, nor weak enough to hurt corporate profits. This positively mild backdrop, combined with moderate inflation, lifted Equity and Fixed Income asset prices, despite some significant headwinds: US president Donald Trump´s announcement of hefty import tariffs in April caused significant volatility, which only abated as some countries (mainly China) retaliated, forcing the US to back down and negotiate.

A deal between the two largest world economies was ultimately reached, letting positive economic growth and rising corporate profits ultimately weigh more than volatility as the year went by. Global Growth, Value and Quality Equity indices ended the year with relatively similar gains (21%, 19% and 17%, respectively), as Growth suffered more from the April’s volatility, but then recovered faster. Value and Quality caught up towards the end of the year, largely due to rising concerns about rich valuations in the AI-driven Technology sector, which led Equity gains throughout 2025.

Bond markets were supported by rate cuts in both Europe and the US, facilitated by the 19% drop in oil prices, which tamed inflation. Most market outlooks published in December point towards a positive 2026, although at MIFL we remain vigilant of rich valuations in some areas, tense geopolitics, weakening US labour data, and still meagre growth in Europe. The MIFL Product Specialist team will continue to brief you every month in 2026, and wishes you a very happy and successful new year.

*All the above reference indices are expressed in local currency terms.