City National Rochdale – Economic Outlook and Investment Strategy, 2025

The economy is on solid footing, driven by robust consumer spending. Rising net worth and intergenerational wealth transfers have kept consumer spending at a strong pace. Labor demand continues to moderate, but layoffs remain near historic low levels. Tax cuts, regulatory reform, and increased defense spending could boost growth, while uncertainty regarding tariff policy creates economic uncertainty. The Fed plans on 50 bps rate cuts this year, expected to start in the summer. Solid earnings and pro-business policies should support equity prices, with a focus on US equities and alternatives offering diversification.