Global Risk Indexes (08-03-2025)

Global 97 (0 —)
MENA 99 ( —)
APAC 97 ( —)
Europe 98 ( —)
Africa 97 (+1 ▲)
AMERs 95 (-1 ▼)
Markets 96 (-2 ▼)
Graham Westcott, Global Markets region analyst at Worldwise Analytica

Graham Westcott

Navigating Global Intersections: Where Trade, Finance, Energy and Geopolitics Converge

Global Markets Brace for Volatility as Trade and Geopolitical Tensions Surge

Trade tensions between major economies have intensified as the United States escalates its tariff strategy against Canada, Mexico, and China. The unpredictability surrounding Washington’s tariff policies has sent financial markets into turmoil, causing a sharp decline in investor confidence. Meanwhile, Beijing’s retaliation with fresh trade barriers on Canadian agricultural and food products signals an extended trade war with global ramifications.

Oil markets are experiencing heightened volatility following conflicting signals from Russia and OPEC over potential production cuts. Brent crude prices saw fluctuations as Moscow hinted at possible reductions while maintaining its April output hike. Simultaneously, renewed U.S. sanctions threats on Russian energy exports have created further market uncertainty.

European economies face fiscal instability as Germany pushes for a 500-billion-euro debt-funded infrastructure package, a move that could overturn its traditional fiscal conservatism. This has sparked legal and political opposition, particularly from right-wing factions. The European Central Bank’s recent rate cut has further exacerbated volatility, sending the euro to its strongest position against the dollar in 16 years.

Poland’s escalating military posture is reshaping NATO’s security landscape, with defense spending projected to reach 4.7% of GDP this year. This aggressive military expansion, coupled with calls for broader NATO defense spending increases, signals heightened regional security concerns in Eastern Europe amid ongoing tensions with Russia.

Stock markets in North America remain under pressure following a steep selloff in U.S. equities. The S&P 500 fell below key technical levels, while Canada’s TSX index saw its largest weekly decline since December. Market instability has been exacerbated by weaker-than-expected Canadian job growth, reinforcing expectations of a Bank of Canada rate cut next week.

Financial markets are pricing in elevated risk levels as uncertainty over U.S. trade policies, European fiscal shifts, and geopolitical conflicts continue to unsettle global investors. With central banks facing pressure to adjust monetary policies in response to deteriorating economic conditions, markets remain highly sensitive to policy developments and geopolitical shifts.

Geopolitical Risk Assessment for the Global Markets
(08-03-2025)

Global markets remain highly volatile as economic and trade disruptions escalate amid tariff wars, geopolitical tensions, and increased military spending in key regions. The growing uncertainty surrounding U.S. trade policies, European fiscal instability, and escalating defense posturing in Asia and Europe are reshaping economic dynamics. Investors are bracing for further instability as financial markets react sharply to policy unpredictability and geopolitical confrontations.

Geopolitical Risk Index

Developments to Follow for the Global Markets (See All Global)

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