What to Make of the Year of the Snake

UOB's latest market outlook highlights potential growth areas for Singapore investors amid growing concerns about US President-elect's proposed steep import tariffs

- By KEVIN LIM

The Year of the Snake traditionally symbolises good luck, wealth and longevity in the Chinese Zodiac. But with a new US president coming in and market uncertainties ahead, could the Lunar New Year usher in prosperity? Or volatility? UOB's 2025 Market Outlook, released on Jan 14, suggests another possibility: Opportunity.

The market outlook is an annual report that features market insights and strategies from the bank's Personal Financial Services wealth management advisory team, in collaboration with UOB Private Bank's chief investment office and the global economics and markets research team.

The big change coming is the inauguration of US President-elect Donald Trump for his second term on Jan 20. He has pledged to cut taxes, reduce regulations and deport millions of undocumented immigrants.

"The market impact will depend significantly on the scale of US policies implemented," notes Mr Abel Lim, UOB's head of wealth management advisory and strategy.

More concerning for the global economy is Trump's proposed tariffs, he adds. The US President-elect has talked about imposing a 60 per cent tax on goods from China, and a 10-to-20 per cent tax on all other US imports. It remains unclear whether he will follow through on this threat.

When Trump won the election last November, US stocks initially rose as many investors viewed his proposed policies as market friendly. But concerns about rising prices and US government debt have resurfaced. Futures prices, which are market-based predictions of an asset's value at a specific time in the future, suggest that the benchmark US 10-year Treasury yield could climb to 5 per cent in the near term, reported Reuters on Jan 10.

This increase reflects growing worries that the incoming Trump administration's policies may worsen existing economic issues like inflation and the sustainability of US government debt.