Global Markets, US Tariffs: Recession Fears and Financial Shifts

Global markets hit their worst losses in over a decade due to rising US tariffs, with fears of a US recession and the dollar weakening as investors seek safety. Meanwhile, JPMorgan Chase raises the probability of a US and global recession to 60% in 2025.

This is the Week in Finance!

Global Markets Tumble as US Tariffs Stir Economic Fears

Global markets experienced their worst losses in over a decade due to escalating concerns over US tariffs, with a key Asian index falling 7.9% and the S&P 500 losing more than 6%, wiping out over US$5 trillion in market value. The market turmoil followed China’s retaliatory 34% tariff on all US imports, and JPMorgan raised the likelihood of a US recession in 2025 to 60%, citing the macroeconomic impact of these tariffs. As investors sought safe-haven assets, the US dollar fell 1.7%, its largest drop since November 2022, signaling diminishing confidence in its global role amidst growing economic uncertainty.

JPMorgan Raises 2025 Recession Risk to 60% Over Tariffs

JPMorgan Chase has increased the likelihood of a US and global recession in 2025 to 60%, citing a significant escalation in US tariffs under President Trump, marking a 20% point increase from its March forecast. The bank warned that the cumulative tariff increases, totaling 22%, would be the largest US tax hike since 1968, potentially triggering a global recession and leading to supply chain disruptions, declining US business confidence, and higher costs. The latest trade measures, including new tariffs on European, Chinese, and Indian goods, are seen as the biggest threat to the global economy, with JPMorgan forecasting that protectionist policies will undermine balanced growth and normalized inflation in 2025.

How Direct Debit Streamlines Finances and Simplifies Daily Life

Direct debit is becoming a transformative tool in Mexico, reshaping how people manage their finances by automating recurring payments, reducing stress, and improving cash flow for businesses. The method is gaining traction as it simplifies payments, cuts operational costs, and provides greater financial predictability, benefiting both consumers and organizations across sectors like education, insurance, and telecom. While challenges such as awareness and technical integration remain, the growth of fintech solutions and collaborative efforts between banks and regulators are helping make direct debit more accessible and secure, offering a more user-centered financial ecosystem.

Banxico’s Steady Cuts: Why Your Portfolio Needs a Makeover

Banxico's decision to lower its benchmark interest rate from 11.5% to 9% has reshaped investment strategies in Mexico, pushing investors away from low-risk options like CETES toward riskier assets like stocks and corporate bonds. This shift is reviving the classic 60/40 portfolio, as rising bond yields make the fixed-income portion more attractive again. However, the changing interest rate environment, compounded by geopolitical uncertainties and trade tensions, highlights the need for diversified, resilient portfolios that can adapt to market volatility and maximize long-term returns.

Peso Slides as US Trade Policies Stir Global Growth Fears

The Mexican peso weakened further against the US dollar on Monday, reaching MX$20.6 per dollar, amid global concerns over the potential impact of US trade policies on economic growth. Investor uncertainty, fueled by the Trump administration's proposed tariffs and trade restrictions, pressured the peso, making it one of the weakest-performing currencies globally. Attention now turns to Mexico's upcoming economic data, including inflation figures and the release of Banxico's policy meeting minutes, which may offer further insights into the country's economic outlook.