The Roundup
Quarter in Review – Q1 2025
Q1 2025 Market Recap — U.S. Volatility Reverberates North
The first quarter of 2025 didn’t unfold as many investors had expected. Markets entered the year on a wave of optimism — record highs in U.S. equities, expectations for a soft economic landing, and the potential for Federal Reserve rate cuts all set the stage for another year of strength. Valuations were stretched, but sentiment remained firmly bullish.
That optimism quickly faded as the new administration in Washington shifted its policy focus from pro-growth initiatives to protectionist trade measures. On Day 1, signs of a potential trade war emerged, with tariff threats escalating throughout the quarter. What began as a rally built on AI-driven innovation and economic momentum turned into a risk-off environment dominated by uncertainty.
