We started 2025 on a high note, although we acknowledged that “no market environment is ever
permanent, and that change is always potentially around the corner.” Well change did come, and with
it, volatility, perhaps in part because we assumed President Trump’s policies would simply mirror those
of his prior term.
The impact of policy direction has been central to market direction this year. Uncertainty around trade
policy dominated the stock market’s path in the first half of the year and will continue to play a large
role in the second half.
In the second half of the year, LPL Research expects to see slower economic growth, a weakening job
market, and a slight uptick in inflation as the delayed effects of trade policy begin to take their toll. This
will make things more challenging for the Federal Reserve (Fed), whose job is to keep inflation in check
and maintain maximum employment. With a full plate to balance, the federal funds rate (which affects
interest rates) will likely remain higher for longer.
Download the full Outlook here:LPL Research Presents the 2025 Midyear Outlook
IMPORTANT DISCLOSURES
This material is for general information only and is not intended to provide specific advice or
recommendations for any individual. The economic forecasts may not develop as predicted. Please read
the full 2025 Midyear Outlook: Pragmatic Optimism, Measured Expectations for additional description
and disclosure. This research material has been prepared by LPL Financial LLC.
Tracking #762971 | LPLE #762973 (Exp. 07/26