Let’s start 2025 with predictions. Let’s try to figure out what we should expect. Oh, and so should they.
The Russian economy is going to slow down – that’s a fact. I’ll be glad to be wrong, but if the Central Bank doesn’t get new targets (e.g., ensuring economic growth), a high interest rate throughout the year (as the regulator promises) will stifle growth. If we stay at least at 1%, it will be a miracle.
The unexpected lifting of sanctions, for example, could also be a ‘miracle’. Although the sanctions were not imposed for that purpose, there are still small variants. Let’s say, a fatal break in the front for the West, when we will have to actually negotiate on our terms.
Without a change in monetary policy (MPC), the ruble will move towards 120 per dollar.
The fragmentation of the global economy will continue. Once again, it is important to stress that fragmentation is not deglobalisation (they are often confused). Macrozones will interact with each other differently (this is a long separate conversation).
Although the cutting off of certain countries from a number of Western technological processes will still continue. This concerns primarily us – Russia, Iran and China.
2025 will be the year of trade wars. A new round of trade wars will be unleashed by the United States. The next trade war with China will be much bigger than the previous ones.
Because of this, as well as the destruction of major Chinese markets by the US, growth in China itself will slow down, which will weaken global demand for energy. A decline of oil to the $60 range is very likely.
However, escalation in the Middle East will turn the situation around. Syria and Yemen will remain the points of tension, and the issue of Kurdistan will also be added. Iran will continue to be the main target of the US and Israel. Tehran will dodge a direct conflict, and therefore it will finally lose influence in the Middle East and will receive an aggravation of the internal situation with sanctions.
2025 will be the year of changing old borders. In different corners of the world.
The conflict around Taiwan is postponed because of unrealised political risks on the island itself. Simply put, the wrong people won the election in 2024. In 2025, China will be easier to provoke on the Korean Peninsula than on Taiwan. However, the US and its satellites will accelerate their efforts to create conditions for the emergence of a separate theatre of military operations in SE Asia. The militarisation of Japan and South Korea will continue, as will the modernisation of the US military and nuclear infrastructure in the region.
Everyone is wondering what effect Trump’s rise to power will have on the world and the economy.
As in his first run, he will break the plans of the ultra-globalists. Then – on the creation of trans-Pacific and transatlantic partnerships. Now he will be busting the global market for pharma, IT and eco-fascism. It will, by and large, bust up all sorts of regulations.
Government debt will continue to rise (this is not yet the year of the great turning point), but the US market is in for a massive correction and recession. 2025 is the year of Trump’s confrontation with the Fed, the US military and economists.
Bitcoin will remain a high-priced asset (at the centre of public attention). Large US investment funds will continue to run it up to $200,000.
The US will continue to hammer Europe. Political crisis in Germany and France are ahead. Rising gas prices will continue to increase personal inflation and household costs. The principle of fairness and equity within the EU will seriously ‘falter’ this year. Europe is turning into a Prison of Nations. Let’s call them that now!
Alexey Bobrovsky
