Tag: global trade

Categories
Learn

2025 investment trends: Trump’s impact on global markets

We have conducted our wealth management survey again in 2025. Here is what UK wealth managers expect to happen with investment demand under Trump’s policies.

  • 94% of UK wealth managers favour US equities under Trump’s pro-business policies, and 90% predict growth in emerging markets.
  • 82% see UK property as a strong hedge against inflation, signalling a shift toward stability-focused investment strategies.
  • 58% of respondents highlight fine wine, art, and classic cars as attractive investments, reinforcing the trend toward tangible, wealth-preserving assets amid economic uncertainty.

With the return of Donald Trump to the White House in 2025, the global investment landscape is experiencing heightened volatility. Events could unfold in any direction given President Trump’s inherent unpredictability – making it more crucial than ever for investors to prepare for the unexpected.

His administration’s tax and trade policies – historically pro-business, protectionist, and favouring domestic production – are already creating ripple effects far beyond US borders. For UK investors, this means a reassessment of how political developments shape financial decisions.

While Trump’s policies could drive stock market rallies, lower corporate taxes, and encourage capital repatriation, they also pose potential risks – such as renewed tariff wars, increased market fragmentation, and a more aggressive stance on trade negotiations. 

The last time Trump held office, his administration imposed tariffs on European wines, disrupting trade and affecting fine wine markets in both the US and UK. In 2025, the geopolitical and economic landscape is vastly different, and while tariffs remain a possibility, the bigger picture suggests that alternative assets – including fine wine – may play an increasingly important role in UK investment strategies.

Investment trends forecast

The expected increase in demand for assets under Trump’s tax and trade policies underscores a broader flight toward stability, alternative assets, and tangible wealth preservation. The following results are based on a 2025 survey among UK wealth managers and independent financial advisors. 

Strongest performing asset classes

US stocks
US equities are projected to see the biggest increase in demand, favoured by 94% of investors. This is a continuation of the 2024 trend, fuelled by expectations of corporate tax cuts, deregulation, and a more business-friendly environment. Historically, Trump’s economic policies have supported stock market growth, and investors appear confident in a similar outcome this time around.

Emerging market stocks
Emerging markets follow closely, with 90% of respondents anticipating increased demand. During Trump’s first term, emerging markets posted positive results, achieving 13.6% annualised growth. However, with Trump’s history of trade wars and potential geopolitical tensions, investors are likely to tread cautiously, focusing on regions that align with US trade interests.

Property
UK property is also enjoying rising demand, according to 82% of wealth managers. At the start of 2025, buyer activity rose 13% year-over-year, with new sales agreed up 12% over 2024. More properties are reaching sale-agreed status, and a 10% increase in listings suggests previously hesitant buyers are re-entering the market. As real estate remains a hedge against inflation, demand for prime and luxury properties is expected to strengthen further.

Cash
The old adage ‘cash is king’ rings true for 80% of investors, reflecting a preference for liquidity amid economic and geopolitical uncertainty. With interest rates still elevated and market volatility expected, investors appear to be holding significant cash reserves, waiting for the right moment to deploy capital.

Alternative and safe-haven assets

Bonds
As fiscal policy and interest rate expectations evolve, 72% of investors see bonds as an attractive asset class. With central banks adapting to economic shifts, fixed-income investments may serve as a stabilising force in portfolios.

Non-US developed market stocks
While US stocks dominate, 72% of investors also foresee demand for non-US developed markets, particularly in regions that may benefit from a changing trade landscape.

Startups & venture capital
With Trump’s pro-business policies likely to fuel entrepreneurial activity, 70% of respondents see an uptick in demand for venture capital and angel investing. Lower corporate tax rates and deregulation could further incentivise innovation and high-growth sectors.

Luxury collectibles
The category that includes fine wine, art, and classic cars is expected to see greater demand, with 58% of respondents highlighting it as an attractive asset class. Given fine wine’s historical resilience during economic downturns and inflationary periods, investors may see it as a store of value amid uncertainty.

Moderate to low confidence assets

Digital currency
Despite Trump’s previous scepticism toward cryptocurrency, his recent endorsement of digital assets may explain why exactly half of respondents see further growth in this sector. While regulatory uncertainty persists, crypto remains a potential high-risk, high-reward investment.

Precious metals
Traditionally a go-to safe haven during market turmoil, precious metals received the lowest investor confidence in our survey. With only 48% forecasting increased demand, this suggests investors may be looking toward more dynamic, yield-generating alternatives rather than passive gold holdings.

Stay tuned for the 2025 edition of the WineCap Wealth Report – published next week.

WineCap’s independent market analysis showcases the value of portfolio diversification and the stability offered by investing in wine. Speak to one of our wine investment experts and start building your portfolio. Schedule your free consultation today.

Categories
Report

Report – Opportunities in uncertainty: the 2024 fine wine market and 2025 outlook

Executive summary

  • Q4 was marked by political developments, changing economic policies, and geopolitical events, including the re-election of President Trump.
  • The strengthened US dollar boosted fine wine demand across the pond.
  • Fine wine prices fell 11% across major regions in 2024, reflecting a continued market correction. 
  • Italy was the most resilient fine wine region, while Burgundy experienced the biggest adjustment.
  • Rhône wines dominated the list of the best performing wines in 2024, with Domaine Pegau Cuvée Réservée Rouge 2013 leading (80.5%).
  • Older vintages (2010-2014) performed well, reflecting the market’s preference for mature, proven wines, while new releases struggled when not priced correctly.
  • Optimism for market recovery is focused on premium regions like Piedmont, Champagne, and Burgundy.
  • Economic uncertainties and mixed performance in Bordeaux are expected to persist, but continued interest in fine wine signals resilience and potential for long-term growth.

Q4 in context: political and economic drivers

Q4 was shaped by significant political and economic developments, most notably the re-election of President Donald Trump in November. Global markets reacted swiftly, with US equities rising on expectations of business-friendly policies and potential fiscal stimulus, particularly benefiting manufacturing and technology.

At the same time, renewed concerns over tariffs created uncertainty for multinational companies. Rising US Treasury yields attracted capital inflows, strengthening the US dollar but also raising fears around higher borrowing costs and a potential drag on global growth. Emerging market currencies came under pressure amid concerns about capital outflows and trade restrictions.

Geopolitical risks eased slightly toward the end of November following a US–France-brokered ceasefire between Israel and Hezbollah. While the agreement reduced immediate tensions after more than a year of hostilities, markets remained cautious, aware that stability in the region remained fragile.

Markets in 2024: the year that was

Risk assets performed strongly in 2024. Bitcoin captured headlines by surpassing $100,000 for the first time, peaking at $104,000 on Coinbase. The rally was driven by optimism surrounding a more favourable regulatory environment under President-elect Trump, reinforced by pro-crypto policy signals and key appointments.

Equity markets also enjoyed a robust year. A resilient US economy, easing inflationary pressures, and a pause in aggressive interest rate hikes supported investor confidence. Strong corporate earnings — particularly in technology and AI — propelled the S&P 500 to another stellar performance.

Energy markets were more volatile. Concerns over slowing global growth, driven by weak demand from China and other developed economies, weighed on crude oil prices. While OPEC production cuts provided some support, they were insufficient to fully offset declining demand.

Gold once again reaffirmed its role as a safe-haven asset. Persistent geopolitical tensions, inflation concerns, and financial market volatility supported demand, underpinning gold’s strong performance throughout the year.

Market performance in 2024

*Current values: 06/12/2024

The fine wine market in 2024

The fine wine market extended its downward trajectory in 2024, following declines seen in 2023. The Liv-ex 100 fell 9.2% year-to-date, while the Liv-ex 50, which tracks First Growth Bordeaux, declined 10.9%.

However, these headline declines masked important regional differences and emerging opportunities. Italy stood out as a pillar of resilience, while previously overheated regions — most notably Burgundy — underwent a necessary recalibration.

Crucially, falling prices were not driven by declining demand. Market activity remained strong, with the number of fine wine trades in 2024 exceeding 2023 levels by 7.9%, highlighting continued liquidity and engagement among buyers.

Regional fine wine performance

Regional fine wine indices performance in 2024

The fine wine market displayed mixed regional performance as the year drew to a close.

Italy was the most resilient major region, with prices falling just 6%, compared to an 11.1% decline in the Liv-ex 1000 index. High-scoring releases supported secondary market demand, while the country’s breadth was reflected in strong performers such as Antinori Brunello di Montalcino Vigna Ferrovia Riserva (+38%). Italy’s growing influence was further underlined by its 22 entries in the 2024 Power 100 — nine more than last year — narrowing the gap with Burgundy and Bordeaux.

Burgundy experienced the most significant adjustment, with prices declining 14.4% year-to-date. After years of exceptional growth, the correction reflects a market recalibration rather than a loss of relevance. Importantly, the pullback has reopened opportunities to acquire rare and prestigious labels at more accessible price levels, reinforcing Burgundy’s long-term appeal as a cornerstone investment region.

Champagne faced a challenging year, with prices down 9.8%, though signs of stabilisation emerged toward year-end. Older vintages led the recovery, with wines such as Taittinger Brut Millésimé (+29%) highlighting enduring demand for high-quality, mature Champagne.

Bordeaux, the largest and most liquid fine wine region, declined 11.3%. While liquidity remains a key strength, it no longer guarantees downside protection. Recent vintages struggled in particular, with many trading below release prices, reinforcing the market’s growing selectivity.

California wines fell 8.6%, but momentum improved in November. Rising interest in producers such as Dominus, Joseph Phelps, and Promontory continued to strengthen California’s position within the fine wine investment landscape.

Spain benefitted from strong US demand, with Vega Sicilia Único ranked as the most powerful fine wine brand of 2024. The inclusion of Dominio de Pingus and R. López de Heredia in the rankings further highlighted Spain’s growing investment credibility.

The best-performing wines in 2024

Top-performing wines of 2024

The Rhône dominated the list of top-performing wines in 2024, claiming four of the top ten positions. Domaine de Pegau Cuvée Réservée Rouge 2013 led the field with an exceptional 80.5% rise, supported by strong performances from Clos des Papes Châteauneuf-du-Pape Rouge 2014 (+61.2%) and Château de Beaucastel Rouge 2013 (+31.1%).

Beyond the Rhône, Spain’s Vega Sicilia Único 2010 (+24.9%) demonstrated the growing strength of Ribera del Duero as a serious player in the wine investment market. Vega Sicilia’s position as the most powerful wine brand in the 2024 Power 100 reinforced this trend.

Bordeaux and Sauternes also featured among the top performers. Château Rieussec secured two spots with its 2015 (+10%) and 2014 (+7.2%) vintages, while Ducru-Beaucaillou 2013 (+19.2%) and Château L’Église-Clinet 2012 (+3.9%) showed that established Bordeaux names continue to attract interest where value is evident.

A clear theme emerged: older vintages outperformed. Wines from 2010 to 2014 dominated the rankings, with only two younger vintages — 2015 and 2019 — making an appearance, and no new releases. This reflects a strong market preference for mature wines with proven track records and immediate drinkability.

2024 takeaways

  • The market correction reopened access to rare and prestigious wines, creating compelling entry points for long-term investors.

  • Established, older vintages consistently outperformed newer releases, reinforcing the value of provenance and track record.

  • Bordeaux’s liquidity remains vital, but value is increasingly selective rather than region-wide.

  • 2024 proved a strategic buying year for investors willing to look beyond short-term volatility.

Bordeaux En Primeur continued to struggle, with the 2023 vintage failing to attract widespread interest — particularly where older, proven vintages offered superior value. Economic uncertainty further reinforced the appeal of classic wines.

Iconic Bordeaux vintages such as 2000, 2005 and 2009, alongside Italy’s Super Tuscans, stood out as stable portfolio anchors. Declining prices also brought previously inaccessible wines back into circulation, allowing for strategic acquisitions at attractive levels.

Beneath the surface of falling prices, 2024 emerged as a pivotal buying year, whether for investors entering the market or enhancing existing portfolios.

2025 market outlook

The outlook for the fine wine market in 2025 is cautiously positive, with optimism focused on premium regions including Piedmont, Champagne and Burgundy. Insights from the 2024 Golden Vines Report show that 64% of industry professionals expect market growth, particularly for high-end Italian wines such as Barolo and Barbaresco, which are increasingly viewed as alternatives to Burgundy.

Sustainability and terroir-driven wines are expected to play a growing role in investment decisions. Piedmont leads growth expectations (20%), followed by Champagne (17%), Burgundy (14%) and Tuscany (12%). Bordeaux faces more mixed prospects, with 27% of respondents anticipating further declines.

While economic and geopolitical uncertainties remain, sustained global interest in fine wine underscores its resilience as a long-term asset class. Celebrated for its diversification benefits, sustainability credentials, and ability to perform across market cycles, fine wine remains the most popular collectible with a unique position within alternative investments.

See also – WineCap Wealth Report 2024: UK Edition

WineCap’s independent market analysis showcases the value of portfolio diversification and the stability offered by investing in wine. Speak to one of our wine investment experts and start building your portfolio. Schedule your free consultation today.

Categories
Learn

The impact of trade wars and tariffs on fine wine investment

The impact of trade wars and tariffs on fine wine investment
  • As an internationally traded asset, fine wine is affected by economic and political factors including trade wars and tariffs.
  • Demand for certain wines and regions can shift as tariffs directly impact pricing, availability and liquidity.
  • Diversification and strategic investment are key to navigating the fine wine market amid trade wars and tariffs.

Over the past two decades, fine wine has transitioned from a luxury product to a well-established internationally traded investment asset. Like any asset enjoying global demand, fine wine is subject to the economic and political forces that shape international trade. 

Legislative decisions, such as changes in taxation and import duties, can directly impact its pricing and accessibility. Trade wars, tariffs, and protectionist policies further add layers of complexity, affecting demand, market stability, and ultimately, investment returns. This article explores how these trade factors influence the fine wine investment market and what investors need to consider.

How trade wars affect wine demand and pricing

Trade wars often involve the imposition of tariffs or import duties on goods traded between countries, which can create a ripple effect across industries and markets. When tariffs are imposed on wine, they can create price volatility, limit access to certain markets, and reduce liquidity, which can impact the investment performance of the affected wines and regions.

For example, in the ongoing trade tensions between the United States and the European Union, wine has frequently been a target for tariffs. In 2019, the USA imposed a 25% tariff on certain European wines in response to a dispute over aircraft subsidies. This tariff included wines under 14% alcohol, impacting popular wine-producing regions such as France, Spain, and Germany, but excluded Champagne and Italy. As a result, Champagne and Italy took an increased market share in the US; when the tariffs were lifted, Bordeaux and Burgundy enjoyed an immediate uptick.  

Market impact of the 2019 US tariffs on European wine: In 2019, Bordeaux accounted for 48% of the US fine wine market on average, according to Liv-ex. From October 2019 to the end of 2020, Bordeaux’s average share of US buying fell to 33%. Burgundy’s share also declined – from 13% before the tariffs to 8%. Conversely, demand for regions exempt from the tariffs rose significantly during this time. Champagne rose from 10% to 14%, Italy from 18% to 25% and the Rest of the World from 4% to 10%. Regions exempt from the 25% US tariffs also saw the biggest price appreciation in 2020. For the first time on an annual basis, Champagne outperformed all other fine wine regions. This led to its global surge. 

Market impact of the 2020 Chinese tariffs on Australian wine: In 2020, China imposed tariffs on Australian wine amid a series of blows to Australian exports, which had a profound impact on Australia’s budding secondary market. Since the tariff introduction, prices for some of the top wines dipped, creating pockets of opportunity. For instance, the average price of Henschke Hill of Grace fell 4%, while Penfolds Bin 707 went down 9%. Since the tariff suspension earlier this year, Australian wine is coming back into the spotlight. 

When it comes to pricing, tariffs can drive up the end cost of imported wine, particularly impacting markets where fine wine demand is driven by consumers with limited domestic alternatives. When tariffs make imported wines prohibitively expensive, consumers may turn to other regions or domestic products. 

From an investment perspective, the unpredictability of trade policies requires a strategic approach that accounts for potential regulatory changes in key markets.

Strategic wine hubs in tariff-influenced markets

In response to tariffs, some regions have positioned themselves as strategic wine trading hubs by offering tariff-free or reduced-tariff environments for wine trade. Hong Kong, for example, abolished its wine import duty in 2008, aiming to become the “wine trading hub” of East Asia. 

This decision has proven instrumental for the fine wine market in Asia, as investors from mainland China and other countries can access European wines without the additional costs that would apply if purchased domestically. As a result, Hong Kong has emerged as a leading location for wine auctions and a key destination for collectors and investors in Asia.

The role of trade agreements

For regions with established wine industries, trade agreements and economic alliances play a significant role in shaping wine tariffs and market access. The European Union, for instance, has trade agreements with multiple countries, allowing for reduced tariffs on wines imported from places like Australia and Chile. However, Brexit has introduced new complexities, as the United Kingdom – one of the largest fine wine markets – now operates independently from the EU. 

For investors navigating the fine wine market amid trade wars and tariffs, diversification and strategic storage are essential. Diversifying across different wine regions and vintages can help minimize exposure to trade barriers affecting specific countries. 

Additionally, storing wine in bonded warehouses can mitigate the risk of sudden tariff impositions on wine imports, preserving the asset’s value. Monitoring geopolitical developments is also crucial, as policy shifts can happen quickly and have immediate effects on wine prices. 

While trade wars and tariffs present complexities, they also create opportunities in the fine wine investment market. In a politically charged landscape, understanding the influence of trade policies on wine markets is critical. By staying agile and responsive to policy changes, investors can better navigate the complexities of wine investment in a globalised yet fragmented market.

Want to learn more about fine wine investment? Download our free guide.