Global Risk Indexes (09-03-2025)

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

Graham Westcott

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

Economic Fragmentation Deepens as Trade Wars, Energy Shocks, and Policy Divergence Reshape Global Markets

Trade Wars and Economic Decoupling Intensify

The U.S.-China economic confrontation reached new levels this past week, with the Trump administration imposing new tariffs on Chinese industrial and technology goods. This move was met with swift retaliation from Beijing, which expanded export controls on key raw materials, further straining global supply chains. These developments highlight the accelerating shift toward economic decoupling, with businesses increasingly seeking alternative suppliers outside of China.

Additionally, U.S. trade actions against Canada and Mexico have added further strain on North American trade relations. The imposition of higher tariffs on Canadian steel and aluminum, along with new restrictions on Mexican exports, is generating uncertainty in the region’s manufacturing sector.

Oil Market Uncertainty as OPEC, Russia, and the U.S. Compete for Market Control

Oil prices remained volatile over the past week, with Brent crude averaging $74.15 per barrel. The market saw conflicting signals from Russia and OPEC, as Moscow hinted at potential production cuts while maintaining its planned April output increase. Meanwhile, U.S. sanctions on Russian and Iranian energy exports have further tightened supply availability.

China and India, the largest importers of Russian crude, are now scrambling to secure alternative energy sources, causing price fluctuations in emerging markets. At the same time, Saudi Arabia has signaled that it may adjust OPEC production levels to stabilize prices, adding another layer of uncertainty to energy markets.

Financial Markets Struggle with Diverging Interest Rate Policies

Central banks around the world are facing conflicting economic signals, leading to diverging monetary policies. While the U.S. Federal Reserve has adopted a wait-and-see approach, signaling that further interest rate cuts are unlikely, the Bank of Canada and the Reserve Bank of Australia have moved towards rate cuts to support growth.

The European Central Bank’s decision to lower interest rates has contributed to currency volatility, with the euro strengthening against the U.S. dollar. Meanwhile, emerging market currencies, particularly in Asia and Latin America, have weakened as investors shift capital toward safe-haven assets.

Stock Market Volatility and Gold’s Role as a Safe Haven

Global equity markets experienced heightened volatility, with the S&P 500 and Nasdaq suffering sharp declines following weak labor market data and continued trade uncertainty. Meanwhile, Canada’s TSX index saw its largest weekly drop since December, fueled by disappointing employment numbers and trade concerns.

Gold prices climbed to $2,915 per ounce, reflecting growing investor anxiety over inflation, currency instability, and geopolitical risks. The sustained rally in gold underscores broader market fears of prolonged economic uncertainty.

Looking Ahead: A More Fragmented Global Economy

As economic nationalism replaces globalization, businesses and investors must navigate a world where trade, energy, and finance are increasingly shaped by geopolitical maneuvering. Supply chain resilience, currency hedging, and strategic resource allocation will be critical in the months ahead.

Geopolitical Risk Assessment for the Global Markets
(09-03-2025)

The global economy is facing heightened instability as trade disputes, energy market volatility, and geopolitical rivalries intensify. The U.S.-China trade war continues to escalate, impacting global supply chains and market confidence. Meanwhile, energy disruptions driven by OPEC+ policy shifts, U.S. sanctions enforcement, and geopolitical instability in Eastern Europe and the Middle East are exacerbating inflationary pressures. Diverging central bank policies further contribute to financial market uncertainty, increasing volatility in global currency and equity markets. The coming weeks are likely to see continued economic fragmentation, with nations prioritizing economic security over globalization.

Geopolitical Risk Index

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

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