As global markets grapple with slowdowns and trade-driven inflation, the #petindustry stands out for its steady demand. This article takes a closer look at the economic landscape ahead—and why pets are proving to be a reliable bright spot.
As we head into Q4 and the final stretch of 2025, predictability has become a rare commodity. If there’s one sure forecast, it’s that uncertainty and volatility will stick around.
Nowhere is this more evident than in the U.S. Invesco, the American investment management firm, notes in its mid-year outlook that “policy uncertainty is weighing on consumer sentiment, pointing to a challenged outlook for the U.S. economy.” Major financial players like J.P. Morgan, Goldman Sachs, and asset management giant BlackRock have echoed this in their recent reports—all highlighting this uncertainty as one of the defining traits of 2025’s economic and financial landscape.
International Trade: Tariffs and Inflation on the Horizon
Another key trend to watch through year-end? How international trade tariffs will ripple through the global economy. Tariffs took effect for some countries back in August, while negotiations with major partners (including Canada, Mexico, and China) are still ongoing—and analysts warn this could push tariff-related inflation higher.
“Even if trade tensions ease relatively quickly, supply chain shocks and other disruptions will likely leave significant impacts,” Invesco explains. Goldman Sachs offers a slightly more optimistic take, though: it expects “the breadth of price increases to be narrower than what we saw in 2022.”
Divided Growth and a Weaker Dollar
Slow growth is taking hold—especially in the U.S., where key indicators paint a mixed picture. J.P. Morgan points to three factors shaping the landscape: a “still-tight labor market,” “resilient wage growth,” and “delayed fiscal stimulus.” Invesco adds that while it expects “U.S. growth to slow in the coming quarters, strong overall household balance sheets should help soften the blow.”
For other economies, domestic conditions will be make-or-break for growth. “The U.S. stepping back on the global stage creates headwinds for surplus nations, but increased stimulus should counteract the worst effects,” Invesco notes. “Overall, we think non-U.S. economies will feel less of a growth hit from trade tensions than the U.S. will.”
A Regional Breakdown
Let’s dive into what’s expected across key regions:
- Europe: Financial institutions are betting on two drivers—fiscal stimulus from major economies like Germany, and interest rate cuts (already on the horizon for the EU and UK). For public companies, Goldman Sachs says “Europe looks attractive, with investment opportunities popping up across sectors in the region.”
- Japan: Real wage growth is expected to give the economy a much-needed boost.
- China: Government support is offering relief. “China is ramping up fiscal spending, and we’re seeing signs of improvement in the property and consumer sectors,” Invesco analyzes. Goldman Sachs also highlights promising investment areas here: advanced manufacturing, technological innovation, and resilient consumption—with a focus on premium products.
Across all regions, reports also project further depreciation of the U.S. dollar. “Given its elevated level and the clear shift in drivers—with interest rate differentials taking a backseat—we expect the dollar to weaken,” J.P. Morgan explains. Invesco adds, “Foreign investors have funneled surpluses into USD assets for over a decade. That trend may be starting to reverse.”
The Pet Industry: Bucking the Trend
Amid all this economic uncertainty, the pet industry is standing strong. Garyth Stone, Managing Director at Houlihan Lokey’s Consumer Group, says a prolonged downturn could actually be an opportunity for the #petmarket.
“When there’s instability, investors zero in on the most reliable areas—and pets are right up there with consumer health and wellness,” he explains. “Even in tough times, you still need to feed your pet; they have to eat every day.” That strong, consistent demand means pet consumption is “more protected”—and investors know it, Stone adds.
Andrea Binder, VP and Pet Industry Insights Leader at Nielsen IQ, agrees: the worst of the investment hesitation is over, and the sector “will bounce back soon,” especially as consumer confidence improves.
For brands and investors alike, the pet industry’s resilience amid volatility is a reminder: when it comes to caring for furry family members, demand doesn’t waver. And that’s a trend that’s likely to outlast the current economic uncertainty.
Source: GlobalPET