Deutsche Bank Analysts Warn of High Risk of Financial Market Turmoil as Summer 2025 Progresses

Deutsche Bank analysts are warning of a high risk of financial market turmoil as summer 2025 progresses, citing historical patterns of volatility shocks, particularly in August.

August has historically seen spikes in volatility, with the VIX Index showing sharp Q3 increases. Thin liquidity currently heightens the risk of amplified market reactions to shocks.

President Trump’s tariff rollout on August 1 poses a significant risk, with punitive duties set to take effect unless trade deals are reached with 14 countries.

Deutsche Bank analysts highlight mounting fiscal pressure from Trump’s tax-and-spend package, warning of potential bond market stress as fiscal expansion pushes yields and inflation expectations higher.

While markets remain resilient, the warning from Deutsche Bank signals underlying unease. Thin liquidity, geopolitical tensions, fiscal stress, and seasonal patterns all point to the need for investors to stay vigilant for unexpected volatility in the near future.