“US Equities Are Now Unpredictable,” Fiscal Council of Cyprus Chair Warns at iFX EXPO International 2025 ⋅ Crypto World Echo
A wave of volatility in U.S. equity markets has driveninvestors toward crypto vehicles, with digital asset funds recording a record$7.05 billion in net inflows in May.
Speaking at a financial conference, MichalisPersianis, Chairman of Cyprus’s Fiscal Council, said “US equities are nowunpredictable and entail unknown risks,” noting that capital is shifting towardalternative hedges like crypto.
The trend comes amid heightened market instabilityfollowing President Donald Trump’s surprise tariff announcement on April 2. The S&P 500 fell nearly 10% over two trading daysafter Trump pledged sweeping new tariffs. The CBOE Volatility Index (VIX)spiked to the mid-50s, a level not seen since the March 2020 Covid crash,signaling intense investor anxiety.
Bitcoin ETFs Inflows
Investors have increasingly turned to digital assetsnot only as a growth play but also as a hedge against inflation and erraticfiscal signals. Traditional equity funds, particularly those focused on U.S.large caps, have seen outflows as market sentiment weakens.
Persianis noted that part of the traditional equityallocation “is being partially replaced by alternative hedges,” suggesting theshift could be more structural than cyclical.
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The realignment follows a year of uneven macroeconomicsignals and speculation around the 2025 U.S. presidential election, which hasadded a fresh layer of uncertainty to the outlook for American markets.
Rising Deficits and Shifting Trade Policies
Persianis’ comments resonate with a recent report bythe Financial Times, which highlighted a complicated situation in the US equitymarket.
Rising deficits, shifting trade policies, and a weakerdollar have prompted some to question whether American exceptionalism inmarkets has ended.
The latest warnings stem from mounting policyuncertainty tied to a potential change in administration. The US fiscal deficitcontinues to grow, and further stimulus proposals could push debt even higher.
Shift Focus to Global Stocks as US Outlook Weakens
A separate report by Business Insider added that fundmanagers are turning away from US equities in favor of international stocks,citing growing risks from trade policies and a potential global recession.
Citing Bank of America survey, the report showed thata majority of investors now expect international stocks to outperform US peersover the next five years.
The survey revealed that 54% of global fund managersbelieve international equities will be the top-performing asset in the yearsahead. Just 23% expect US stocks to lead performance, while a combined 18%picked bonds or gold as their preferred long-term bet.
This article was written by Jared Kirui at www.financemagnates.com.
