 |
SINGAPORE, June 24, 2025 /PRNewswire/ — In its 3Q 2025 Quarterly Investment Strategy to be published this week, UOB Asset Management (UOBAM) highlights the almost equal probability of three US economic scenarios: a US recession, continued growth, and stagflation, that is, slow growth accompanied by persistent inflation.
Faced with these near-equal odds, the firm recommends that investors adopt a neutral positioning and regional diversification. This means investors whose portfolios were previously overweight in the US should start to shift their focus to Asia and Europe.
Anthony Raza, Head of UOBAM Multi-Asset Strategy, explains, “In 2Q, the news cycle was dominated by President Trump’s haphazard trade and tariff policies. All markets wanted to know was which countries would get off more lightly than others.”
“But in 3Q, attention looks likely to shift to the impact of these policies on the US economy. Everyone is closely watching US inflation and employment data to see if there are any signs of a possible recession. I would say that so far, the data is inconclusive, and could go either way in the coming months.”
The revaluation of Asian markets has already begun, with Asian markets as a whole up more than 10 percent[1] so far this year, compared to about 2 percent for the US’s S&P500 index. Despite concerns about the impact of tariffs on the Chinese economy, there seems to be a lot of investor optimism that Chinese companies will be able to weather this storm.
Chong Jiun Yeh, UOBAM’s Group CIO, notes, “Asia has a few things going for it. The region has become a lot more self-sustaining, and funds are more likely to rotate within the region rather than leave it altogether, as we are seeing currently with South Korea and China. In addition, many Asian countries have large populations and therefore, a thriving domestic consumption sector that is resilient to trade wars.”
“Finally, I would point to the softening USD. Asia tends to benefit when the USD is weak, and it is now at a three-year low. We don’t think this depreciation is a short-term adjustment. Structural problems in the US such as higher-for-longer inflation and high debt levels have called into question the role of US Treasuries and the dollar as the go-to in any crisis.”
Read the full Q3 2025 Investment Strategy: https://www.uobam.com.sg/insights/qis3q25.page
About UOB Asset Management
UOB Asset Management Ltd (UOBAM) is a wholly-owned subsidiary of United Overseas Bank Limited. Established in 1986, UOBAM has nearly 40 years of experience in managing collective investment schemes and discretionary funds in Singapore, making us among the largest unit trust managers by assets under management. As of 31 May 2025, we manage 62 unit trusts in Singapore and, together with our subsidiaries, oversee S$37.6 billion in client assets.
Headquartered in Singapore, UOBAM has a strong presence across Asia, with business and investment offices in Brunei, Indonesia, Japan, Malaysia, Thailand and Vietnam. Our network includes UOB Islamic Asset Management Sdn Bhd in Malaysia, a joint venture with Ping An Fund Management Company Limited and strategic alliances with partners such as Wellington Management Singapore.
UOBAM is one of the region’s most awarded asset managers, with over 360 awards won. In 2025, we were recognised as the Best Asset Management Company (Regional) by the Asia Asset Management and previously named Best Asset Management House in Asia – 20 Years in 2023. Our digital innovation has also earned top honours, including Best Digital Wealth Management in Asia[2] and Best Robo Advisory Initiative[3] for 3 consecutive years as of 2024.
As a leader in sustainable investing, UOBAM was awarded Best application of ESG in ASEAN[4] (2023) and has received multiple sustainability accolades in Indonesia and Thailand. Our artificial intelligence capabilities were also recognised with the Most Innovative Application of Artificial Intelligence (ASEAN) for 2 consecutive years[5].
Connect with us: LinkedIn | Facebook
|
[1] Performance of the MSCI Asia Pacific ex Japan, as of 20 June 2025 |
|
[2] Awarded by Asia Asset Management |
|
[3] Awarded by The Digital Banker for the Global Retail Banking Innovations Award |
|
[4] Awarded by Asia Asset Management |
|
[5] As of 2025, by Asia Asset Management |
