It is impossible to predict the future, but forex traders certainly try. At least in the sphere of currency moves. There is a lot of uncertainty about what’s coming, but some things are more certain than others. Especially considering certain reasonable assumptions.
If we take the practical assumption that the world as we know it will continue to go around the sun for another 12 months, there are certain Market Events 2025 we know will happen. Elections will take place, national budgets will have to be agreed on, and central banks will have to adjust monetary policy according to the conditions in the economy.
Here are some Market Events 2025 that could shake up the markets.
January 20: Donald Trump returns to the White House. Although in the transition period he has given a pretty strong preview of what to expect from his second turn as President, the real test is when he’s actually able to implement the policies he’s promised (or threatened, depending on your view).
Of course “on day one” is more of a rhetorical device for politicians to emphasize their priorities, since Inauguration day comes with a lot of routine paperwork. But Trump is showing an interest in hitting the road running, and might actually implement things like tariffs within the first week of assuming office. However, the new Administration still needs to be formed, which requires Congressional approval of Cabinet picks – a process that can take months. That would likely delay some of the policies being enacted for a time.
Getting Spending in Order
The other issue that the US has to deal with politically is the debt ceiling, set to snap back into place with the start of the new year. The US Treasury has plenty of cash on hand to keep functioning for at least three months, giving time to resolve the issue. But, the first quarter could see politicians trying to leverage bond rates to push through their preferred policy, generating volatility in the dollar.
The other country in a similar predicament is France, which adopted a “US style” budget stop gap just a couple of weeks ago. Since then, new PM Francois Bayrou has struggled to meet his self-imposed deadline to form a government by the end of the year. Which might be a sign that he will struggle to meet the deadline of April for when a new French budget needs to be passed. That could trigger a similar crisis as happened in November, which cost Michel Barnier the premiership.
Getting Leadership in Order
The other event that will get a lot of market attention is the upcoming German general elections at the end of February. While the right-of-center CDU party is leading in the polls by a wide margin, the same polls suggest that it won’t get a large enough margin to govern. That could lead to protracted coalition negotiations similar to the last election, raising risk concerns for Europe’s largest economy. An uneasy right-leaning “three way” coalition to replace the left-leaning one that collapsed over spending debates might not reassure traders all that much.
Other elections of note include Canada’s federal election expected in October (if the government doesn’t collapse before then), with the current Prime Minister seen as deeply unpopular and unable to be reelected. The UK’s local elections, although not changing who holds power at the national level, are often a litmus test for the government and can cause policy changes depending on the results. They are scheduled for May 1st.
![Credit Card 160×600 [EN]](https://assets.iorbex.com/blog/wp-content/uploads/2023/06/13144507/Blog-Banner_EN-Banner_160X600X2.webp)
