As 2025 draws to a close, it is worth stepping back from the noise of daily market moves and political squabbles to ask what the year actually meant economically.
The answer, I think, is that 2025 was the year the post-Cold War economic consensus finally and irrevocably fragmented.
The assumptions that underpinned three decades of globalisation: that trade liberalisation would continue indefinitely, that geopolitical rivals could be integrated into a rules-based order, that central bank independence would remain unchallenged, and that Western democracies would maintain the political will for fiscal discipline, have all come under sustained pressure simultaneously.
What will emerge from the wreckage is uncertain. The Trump tariff regime has forced a partial reordering of global supply chains that will take years to stabilise.
Germany’s industrial decline has exposed the fragility of an economic model that outsourced its energy security to Russia and its export markets to China.
Britain, navigating between a difficult relationship with Europe and a transactional one with America, is still searching for a coherent economic identity post-Brexit.
There are some reasons for measured optimism, though. Interest rates are falling across the developed world and inflation has been tamed without the deep recession many feared.
A cause for concern is the lack of jobs growth in the UK and across Europe. Often put down to the rise of AI, I suspect it is a more garden variety downturn than many are willing to admit.
This trend may continue in 2026, but it’s difficult to say how long for and how severe it will be.
2026 will tell us whether the disruption of 2025 was creative destruction or just destruction. For me, it seems like more of the former. But what do I know?
Macro Aggressions 