Amundi Is Betting on European and EM Assets to Avoid US Risks

Amundi SA, Europe's largest asset manager, is adopting a "mildly pro-risk" stance, favoring European and emerging-market assets over US investments, anticipating increased volatility stemming from US tax and trade policies. The firm recommends hedging against inflation and foreign exchange fluctuations, projecting a significant slowdown in US economic growth to 1.6% by 2025-2026.

Analysis

Amundi SA, Europe's largest asset manager, is adopting a "mildly pro-risk" investment stance, strategically shifting its focus towards European and emerging-market assets to mitigate perceived risks associated with the US market. This positioning is driven by an anticipation of increased market volatility, potentially stemming from future US tax and trade edicts from the White House. Amundi specifically recommends that investors consider implementing hedging strategies against both inflation and foreign exchange fluctuations. The firm's cautious outlook on the US economy is underscored by its projection of a significant deceleration in US economic growth to 1.6% for the 2025-2026 period. This perspective, which aligns with the provided cautious tone and mildly negative sentiment signals, suggests a recalibration of global asset allocation preferences in response to evolving macroeconomic forecasts and policy uncertainties, particularly those emanating from the US.

Key Decisions for Investors

• Investors should evaluate reallocating portfolios with a greater emphasis on European and emerging-market assets, reflecting Amundi's strategic shift away from concentrated US market risks.
• It may be prudent to implement or bolster hedging strategies against inflation and foreign exchange volatility, particularly in light of Amundi's recommendations and the anticipated market environment influenced by US policies.
• Closely monitor US economic indicators, specifically growth forecasts which Amundi projects to slow to 1.6% in 2025-2026, and any developments in US tax and trade policy, due to their potential to induce significant market volatility.