St. Galler Kantonalbank (SGKB) has released its investment outlook for 2025, projecting a continued low-interest-rate environment.
SGKB forecasts two interest rate cuts by March 2025, bringing the key rate down to 0.5 percent. While the possibility of negative interest rates remains on the table, the Swiss National Bank (SNB) is more likely to focus on purchasing foreign currencies to mitigate the appreciation of the Swiss franc.
Investors are urged to seek alternatives to traditional bonds in this low-interest landscape. The yield curve is expected to remain below 0.7 percent until the end of 2029, prompting a shift towards equities, particularly high-dividend stocks. Swiss equities, with an average dividend yield of 3 percent, are positioned as attractive options for those looking to invest pension fund assets. The importance of cumulative dividends is emphasized by Stucki, SGKB's Chief Investment Officer, highlighting their potential impact in the current market.
Gold continues to be regarded as a safe haven asset, with SGKB recommending a portfolio allocation of 5 to 10 percent in gold, especially in light of central banks' ongoing purchases that support its price. In contrast, Bitcoin is viewed as a speculative investment, characterized by high volatility and a narrow market. SGKB's analysis suggests that Bitcoin's close correlation with the stock market renders it unsuitable for strategic asset allocation. Despite growing interest in Bitcoin, including from pension funds, it is seen more as a topic for discussion rather than a serious investment option.
Amidst the ongoing discussions about Bitcoin and traditional assets, new crypto projects are gaining traction. One such project is Pepe Unchained, a meme coin that aims to combine the popular meme culture with a robust technical foundation. Built on its own layer 2 blockchain, Pepe Unchained promises faster transactions and lower fees, appealing to both developers and investors. The presale of the token has already raised nearly $58 million, indicating strong market interest and potential for future growth.
Analysts are optimistic about Pepe Unchained, with some forecasts suggesting that the value of its token, $PEPU, could rise to as much as USD 0.027 by the end of 2025, contingent on the successful implementation of its roadmap and a favorable market environment. The project plans to introduce features such as a decentralized exchange (DEX) and a tool called "Pepe's Pump Pad," which will allow users to create their own meme coins with ease. Such innovations could not only expand the community but also drive demand for the token, showcasing that meme coins can possess real potential beyond mere speculation.
As the cryptocurrency market evolves, the distinction between traditional investments and innovative digital assets becomes increasingly pronounced. While established institutions like SGKB maintain a cautious approach towards Bitcoin, the emergence of projects like Pepe Unchained illustrates the dynamic nature of the crypto landscape. Investors are encouraged to remain vigilant and informed as they navigate this complex environment, balancing the allure of high returns with the inherent risks associated with speculative investments.