Global Asset Allocation Strategy — July 2025

July 10, 2025 — Global Asset Allocation Strategy provides an overview of key economic and policy themes and how Sage is positioned in the current market environment.

Key Takeaways

• Market sentiment in Q2 was driven more by policy shifts and geopolitical developments than economic fundamentals, but we expect a pivot toward data-driven narratives in the second half.
• While we align with consensus in expecting the US to avoid recession, we see risks in the labor market and anticipate the Fed will delay rate cuts until at least September, creating a supportive backdrop for both equities and fixed income.
• Our positioning reflects a growth tilt with increased equity exposure — particularly in software and banks — and a fixed income strategy favoring intermediate duration and spread sectors, such as agency MBS, high yield, and EM debt.