Tactical Asset Allocation

June 2025 update

Instability in global trade policy continues to cloud the outlook. Over the past month risky assets have generally overlooked these developments, with equities outperforming fixed income and credit spreads tightening by 20-60bps between investment grade, high yield, emerging sovereign debt, and bank loans.

For the 12th consecutive month, our framework remains in a contraction regime. We maintain a cautious asset allocation versus our benchmark, overweighting bonds relative to stocks, and favoring defensive sectors. We move to a moderate underweight in developed ex-US stocks vs. US stock on lower earnings expectations. In fixed income, we’re overweight duration via inflation-linked bonds, and underweight credit risk.

Get the full story

See what our macro regime framework is telling us — and what we’re doing in response — in our June 2025 Tactical Asset Allocation update.

Topics include:

• Macro update —  US leading economic indicators continue to slow, led by weak business and consumer sentiment surveys, while hard economic statistics suggest ongoing resilience in labor markets and consumer spending.
• Markets — Our barometer of global risk appetite has recently stabilized, but remains on a decelerating trend, historically consistent with deteriorating growth expectations.
• Investment positioning — See what we’re favoring in stock, bond, and currency markets.