The key points are:
The main themes for 2024 were: better than feared growth; global divergence; more disinflation; falling interest rates but with Australia lagging; and more geopolitical threats but not as bad as feared. As in 2023, returns were strong.
2025 is likely to see positive returns, but after the surprising calm of 2024, it’s likely to be far more volatile (expect a 15% or so correction along the way) and more constrained.
Expect the RBA cash rate to fall to 3.6%, the ASX 200 to rise to 8800 and balanced super funds to return around 6%.
Australian home prices will likely see further softness ahead of rate cuts providing a boost in the second half of 2025.
Key things to keep an eye on are: interest rates; recession risk; a potential trade war; and the Australian consumer.