The post 2025 will see Fed rate hikes, rampant Trump tariffs and a China recession, says Apollo appeared on BitcoinEthereumNews.com.

Apollo Management dropped its 2025 market risk report, and it’s not looking pretty. Fed rate hikes are back on the table, Trump is ready to slap tariffs on half the world, and China’s economy might finally cave under the weight of its deflation crisis. If this plays out, 2025 won’t just be volatile, it’ll be a financial minefield. Trump’s potential tariffs lead the charge. Apollo gives them a 90% chance of happening. The targets? Everyone. Canada and Mexico could see 25% slapped on their exports. BRICS countries like China, Brazil, Russia, and South Africa might face up to 100% tariffs.  Apollo says these tariffs could knock 1.7% off U.S. GDP, but tax cuts are expected to offset the hit with a 2.4% boost. Nvidia’s bubble, inflation’s comeback, and the Fed’s dilemma Nvidia, the darling of the AI boom, might crash back to Earth. Apollo warns there’s a 90% chance the company’s earnings will miss Wall Street’s sky-high expectations. After driving 20% of the S&P 500’s gains in 2024, Nvidia’s shine is fading. Even hitting targets in Q3 didn’t trigger a rally, and 2025 looks even tougher. Apollo isn’t optimistic. Inflation is the other big story. It’s clawing back into the spotlight after months of cooling. Apollo sees a 40% chance that inflation will heat up in Q1 2025. Core CPI’s annualized 3-month rate is already above 3.5%. CPI, PCE, and PPI are all climbing. The Fed has noticed. It’s trimmed its rate cut forecast for 2025 from three to just two, totaling 50 basis points. Apollo believes rate hikes are back on the table with a 40% probability. This would hit crypto and stock markets alike, igniting new volatility. The Fed might also abandon its beloved r-star framework, according to Apollo. The real neutral interest rate, which balances economic growth…

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Filed under: News - @ December 23, 2024 6:26 pm