April 2025 – a volatile month that ends well

Select Wealth Management – Monthly View – May 2025

Global financial markets experienced a very unpleasant start to April as US President Donald Trump unveiled larger than expected “reciprocal” tariffs on countries around the world.

As the month went on things got better. Global markets stabilised and recovered after Trump called for a 90-day pause for the reciprocal tariffs. In the final wash, Global sharemarkets fell -0.4% in April.

The uncertainty from Trump’s trade and tariff policy will continue for some time, which is unsettling for markets. Financial markets will ebb and flow on the potential and actual outcomes of tariff negotiations and concessions.

Other developments may also bring relief for global equity markets, including:

• Central banks continuing to reduce interest rates, particularly in Europe, Australia, and NZ.
• The prospect of political pushback in the US resulting in a toning down of trade policy.
• A pivot by the Trump administration to promote the more positive elements of their policy agenda such as tax cuts and deregulation.

The New Zealand and Australian economies are well placed relative to the rest of the world in the current uncertain global economic environment and the local fixed income market is likely to benefit from further reductions in interest rates by the RBNZ.

At times of market volatility, we recommend investors continue to focus on their long-term goals, leaving fund managers to invest in line with their fund’s objectives.

Select Wealth Management’s Monthly View (May 2025) is available at this link.