Trump and Chinese AI to Set the Course for the Global Economy in 2025, according to CaixaBank AM

• The current "roller coaster" scenario resulting from the latest decisions by the Trump Administration might not drag the rest of the world down if economies react quickly and in a coordinated manner.
• 2025 will be a year where active tactical management prevails. We move from the motto 'buy the dips' to 'sell the rallies and buy with fear.'

We must take Donald Trump seriously. The economic policies of the President of the United States have generated a strong reaction in international markets, posing significant risks to global growth. 

Jorge Colomer, Deputy General Manager and Chief Investment Officer of CaixaBank AM, and Santiago Rubio, Head of Investment Strategy at CaixaBank AM, analyzed the performance of the first quarter of 2025 in a joint discussion, marked by the inauguration of the new administration in the United States; an administration that, along with Artificial Intelligence, will set the course for the global economy for the rest of the year.

(Video in Spanish)

For CaixaBank AM experts, the new measures under the Trump Administration have caused extreme volatility in the financial market, with a "roller coaster" behavior reflecting the uncertainty of the new policy across the Atlantic.

The ultra-nationalist policy of the Trump administration has imposed the largest tax hike since World War II, which could significantly affect consumption and production and increase the risk of a recession in the U.S. But this scenario might not drag the rest of the world down if economies react quickly.

Santiago Rubio

Germany, on its part, has initiated a radical fiscal change to counteract the negative repercussions. Similar responses are anticipated in Canada, China, and Japan, with more active fiscal policies in response to the American slowdown, which could prevent a global recession.

This coordinated reaction is essential to neutralize the potentially disruptive effects of a restrictive U.S. fiscal policy.

Santiago Rubio

Chinese AI 

On the other hand, emerging markets have been affected by a series of significant structural changes caused by the impact of technological regulation. Especially in China, advances in artificial intelligence are accelerating global productivity and compensating for the lack of access to chips, with Chinese mathematicians discovering alternative routes for innovation and demonstrating that implementing artificial intelligence is cheaper than we imagined.

For CaixaBank AM experts, these innovations not only represent a growth opportunity but also a competitive threat to economies that do not adapt their technological infrastructures. Thus, the challenge for investors is to capitalize on these possibilities without losing sight of the inherent risks of technological transitions. 

Although the U.S. might see a stagnation in its internal technological promotion, other countries will have easier access to these advanced tools. This creates a competitive framework where innovation can become the catalyst for a new wave of growth in technology-importing regions, with Europe at the forefront.

Jorge Colomer

Investment Trends for 2025 

Given this outlook, Colomer and Rubio agree that the potential economic effects of U.S. policy in the short and long term create a scenario that necessitates a rethinking of traditional investment tactics, emphasizing the need for pragmatic and reactive projects. 2025 will be a year where active tactical management prevails. 

We move from the motto 'buy the dips' to 'sell the rallies and buy with fear.' This change requires a balance between agility and a well-defined strategy, with a special emphasis on not making significant moves that deviate from the established investor profile.

Santiago Rubio

In this high-volatility scenario, investors are advised to avoid extreme movements outside their risk profile and trust the manager's agility in an environment where markets can react abruptly and without warning. Jorge 

A change in investor mentality is necessary, promoting adaptability while maintaining a clear direction.

Jorge Colomer

2025 will be key to evaluating how global markets respond to political and economic challenges, with constant tension between the pessimism generated by increased protectionism and the optimism driven by technology, fiscal stimuli, and reduced energy costs.