Autumn Update Q1 - 2025

Navigating the Economic Waves: Autumn 2025 - Q1 Market Commentary

As we sail into the second quarter of 2025, the financial seas have proven to be both turbulent and enlightening. Central Financial Planning's latest economic commentary provides a comprehensive overview of the first quarter, highlighting key market movements and the broader economic landscape.

A Challenging Start to the Year

Fresh off the back of an excellent year in 2024, the first three months of 2025 ushered in a more difficult investment environment. While some markets performed creditably, others, including the influential US share market, were down for the quarter, contributing to reduced portfolio valuations for many investors.

Investor Sentiment Tested

Investor sentiment was put to the test as the quarter progressed, with much of the uncertainty centered on key policy initiatives within the globally important US economy. The directives coming out of the White House in early 2025 clearly contributed to market wobbles throughout the first quarter and into April.

The most telling of these was the adverse global reaction to the US’s ever-evolving plans to implement widespread new international trade tariffs. President Trump initially announced tariffs on certain countries (notably Mexico and Canada) and on some goods (cars, steel, and aluminium)

Global Market Reactions

The market reaction to these tariff announcements was swift and significant. International share markets experienced volatility, with some sectors being hit harder than others.

The uncertainty surrounding these policies created a ripple effect, impacting investor confidence and market stability New Zealand's

Housing Market: A Silver Lining?

Amidst the global economic turbulence, there was a potential silver lining for New Zealand's housing market. The commentary suggests that lower mortgage interest rates could benefit housing values in New Zealand, providing some relief to homeowners and investors alike.

Long-Term Strategy: A Timely Reminder

In this feature article, we share key insights from four Nobel Prize-winning economists—a timely reminder that when times get tough, it's more important than ever to stay focused on long-term strategies and not get caught up in short-term market ‘noise’. This advice feels especially relevant right now, with all the market ups and downs making it tempting to react too quickly.

Looking Ahead

As we move forward into the rest of 2025, it will be essential for investors to remain vigilant and adaptable. The insights provided by Central Financial Planning offer valuable guidance for navigating these uncertain times. By staying informed and maintaining a long-term perspective, investors can better weather the economic storms and seize opportunities as they arise.

Read Full Report