As market narratives shift in 2025, JPMorgan’s Making Sense podcast delivers a sharp macro reset in its latest mid-year outlook episode. One key theme runs throughout: the era of U.S. exceptionalism may be ending, and investors need to brace for slower growth, weaker corporate margins, and policy risks that stretch far beyond the usual suspects.
Here’s what stood out from the hour-long discussion with JPMorgan’s research heads across macroeconomics, equity strategy, commodities, and FX.
The Tariff Shock Is Just Getting Started
Chief Global Economist Bruce Kasman outlines a clear framework for how new U.S. trade policies are set to drag on growth. With an effective 10-point rise in U.S. tariff rates, the impact is unfolding in three waves:
- Frontloading Reversal: Businesses and consumers accelerated spending ahead of tariffs — that’s now fading, turning into a drag.
- Tax Burden: Tariffs are acting like a stealth tax, squeezing purchasing power.
- Sentiment Shock: Business confidence is falling fast — both in the U.S. and globally.
While recession isn’t JPMorgan’s base case, Kasman places a 40% probability on the U.S. sliding into one in the second half of 2025.
The Fade of U.S. Exceptionalism
What happens after the shock is absorbed? Kasman is blunt: “U.S. macro outperformance is unlikely to return.”
Between tighter immigration, reduced government investment, and margin pressures, the forces that powered America’s standout growth from 2022–2024 may now be turning into headwinds.
Equities: AI Is the Only Leader That Matters
U.S. Equity Strategist Bhupinder Singh shares that AI-linked stocks remain the dominant driver of S&P 500 performance — a narrow rally that could carry risk if leadership falters.
Surprisingly, even with tariff uncertainty, 57% of S&P 500 firms maintained guidance, and nearly a third raised it. But Singh warns that tailwinds from corporate buybacks are fading, and positioning has become more cautious, especially among institutional players.
Oil is Plentiful. Geopolitics Isn’t Changing That.
In the commodities segment, Natasha Kaneva (Global Head of Commodities Research) cuts through the noise: oil remains in an oversupplied state.
Despite a 12-day Middle East war and fears of supply disruptions, oil traded at JPMorgan’s price target of $67 during Q2. Why? Because there was no actual impact on oil flows — shipping volumes through the Strait of Hormuz increased, although insurance costs soared.
This mirrors the recent analysis by Norbert Rücker from Julius Baer that the recent uptick in oil prices will not last.
Indeed, oil prices have dropped more than 10% from its recent high in June 2025. JPMorgan is forecasting Brent to be in the low to mid $60s for the rest of 2025, barring geopolitical escalation.
Gold: A Bull Run That Central Banks Built
JPMorgan’s bullish view on gold isn’t new — it dates back to late 2022 — but it’s now anchored by one big force: central bank buying that is no longer price sensitive.
With purchases climbing from 400 to over 1,000 tons annually, and ETFs plus retail demand picking up, Kaneva sees $3,700 gold by year-end, and $4,000 by mid-2026.
Credit, Bonds, and the Dollar: Cracks Emerging
From credit spreads to FX, the tone is the same: resilience under pressure, but storm clouds ahead.
- Credit strategist Stephen Dulake expects private credit to keep growing — particularly as mid-sized borrowers look for flexibility amid slower growth.
- Jay Barry, head of global rates strategy, warns that shifting foreign demand for U.S. Treasuries could push long-term yields higher even if the Fed cuts short-term rates.
- FX strategist Meera Chandan reiterates a broadly bearish dollar outlook, driven by U.S. policy fatigue and relative strength in European fiscal dynamics.
Takeaway: Don’t Let Surface Resilience Fool You
JPMorgan’s outlook is a rare blend of optimism and realism. The bank isn’t calling for a market crash — but it is warning that the U.S. may no longer be the invincible macro machine it once seemed.
Tariffs, fading policy stimulus, rising debt loads, and geopolitical uncertainties all point to a tougher second half — with opportunities, yes, but only for those who look past the headlines.
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