The Helaba Capital Market Outlook 2025: Global economy on the catwalk

Helaba has published its annual Economic and Capital Market Outlook 2025, in which it presents three possible scenarios for the global economy. Under the motto ‘Global economy on the catwalk’, the experts analyse the factors influencing monetary and fiscal policy, geopolitics and developments in Germany, the USA and China. Three scenarios are possible.

1. “Workwear” base scenario (65 % probability):

• In this scenario, the global economy stands for robust and flexible development, comparable to hard-wearing workwear.
• The central banks – above all the Fed and the ECB – have eased monetary policy after tightening it massively in 2022.
• Inflation is under control without triggering a severe recession.
• Countries such as Germany and China, which are struggling with growth problems, cannot attribute these solely to high interest rates.
• In the USA, there are many signs of a ‘soft landing’.

2. Negative scenario “The Emperor’s New Clothes” (25 % probability):

• The negative scenario is characterised by disappointment, similar to the fairy tale ‘The Emperor’s New Clothes’, in which the splendid robes are an illusion.
• The economic policy measures taken by governments and central banks turn out to be a mirage.
• A shock — such as a geopolitical escalation — could shatter the illusion and force companies, consumers and financial markets to make sudden adjustments.
• Possible triggers include the further escalation of conflicts in Ukraine or the Middle East, new flashpoints in Asia and transatlantic tensions due to differing views on the decarbonisation process or protectionism.

3. Positive scenario “Haute Couture” (10 % probability):

• In this scenario, the global economy experiences a boom that is compared to exclusive haute couture.
• International co-operation, which reduces geopolitical tensions, as well as deregulation and technological progress are the drivers.
• Corporate investment, which has room for improvement in the eurozone and the USA, is being stimulated by smarter regulation.
• Governments and central banks are playing their part in success: governments are increasingly promoting public investment and central banks are tightening monetary policy only to the extent that overheating is prevented.

The complete analysis of the global economic outlook and the opportunities and risks analysed for the coming years can be found in Helaba’s Capital Market Outlook 2025 (in German).