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Stocks are expected to face a significant correction in the first half of 2025, driven by slowing consumer momentum, a softening labor market, and historically high valuations. Analysts predict a potential drop of over 20%, advising investors to adopt defensive strategies and consider buying after a substantial decline. The current economic indicators suggest a heightened risk of recession, making equities a precarious investment.
The budget law is set for its first parliamentary vote on December 11, with around 250 amendments expected. The government aims to avoid new taxes, cut the tax wedge, and prioritize family aid, while also addressing business support, including a potential IRES discount for reinvestment. Key discussions will focus on minimum pension increases and the exclusion of police from public sector turnover freezes, as the Ministry of Economy seeks financial coverage for these measures.
Zurich faces pressure to reduce its tax rate significantly by 2026, as neighboring cantons cut taxes while Zurich struggles with rising government spending and insufficient savings. The cantonal parliament is currently debating a budget of nearly 20 billion francs, with a modest surplus of 200 million francs for the upcoming year.
Most economists predict that Prime Minister Justin Trudeau’s government will exceed its self-imposed fiscal constraints, as deficits in Canada worsen. A Bloomberg survey revealed that 13 of 15 economists believe Finance Minister Chrystia Freeland will fail to meet her fiscal commitments, including capping the 2023-24 shortfall at C$40.1 billion. Additionally, there are concerns about maintaining a declining ratio of federal debt and deficits to GDP.
The Netherlands Finance Minister Eelco Heinen has called for the European Commission to apply the same strict standards to France as it did to the Dutch budget, emphasizing that spending cuts are essential for the benefit of Europe. Despite France's higher deficit and debt levels, the EU has historically granted it leniency, with its 2025 budget set to be formally adopted in January, binding future governments to its planned cuts.
Chancellor of the Exchequer Rachel Reeves announced the UK’s commitment to enhancing economic ties with the European Union, aiming for a more ambitious and mature relationship. Speaking at the Eurogroup meeting in Brussels, she emphasized the importance of practical steps to benefit both the UK and the EU.
Alex Patelis, chief economic adviser to Greek Prime Minister Kyriakos Mitsotakis, has resigned after over five years in the role. In a Facebook post, he highlighted the government's achievement of returning the country to investment grade and ensuring economic stability since 2019. Patelis's final day in office will be December 31.
India's textile sector is set for growth as global disruptions in competing markets, particularly in China and Bangladesh, create new opportunities for exporters. With rising labor costs in China and political instability in Bangladesh, Indian apparel exports to the US and UK have increased, reaching 7% and 6% respectively in 2024. Companies like Gokaldas Exports anticipate improved demand in the second half of the year, driven by the festive season and the end of the global inventory de-stocking cycle.
Top advisers recommend a temporary ban on solar geoengineering as a climate summit concludes with a contentious $300 billion climate finance deal for developing nations, which many feel is insufficient. Tensions rose as representatives expressed frustration over unmet expectations and uncertainties surrounding future funding commitments.
Chinese Premier Li Qiang has committed to taking all necessary measures to enhance domestic consumption to support economic growth. During a meeting with leaders from ten international economic organizations, he emphasized the importance of strengthening countercyclical measures and implementing macroeconomic policies to stabilize the economy.

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