ECB rate cut to accelerate shift away from US stocks: deVere Group
The European Central Bank’s widely anticipated rate cut today will do more than just bolster the eurozone’s recovery.
It will “supercharge” an already-growing move by global investors out of US assets, according to Nigel Green, CEO of deVere Group, one of the world’s largest independent financial advisory and asset management organizations.
The ECB’s likely decision to lower its deposit rate to 2%, the eighth reduction since 2023, is being welcomed by investors increasingly wary of the US market’s risks—from political volatility and spiraling debt to erratic trade policies that are rattling global confidence.
With another cut expected in September and policymakers signaling a slowdown in further easing, attention is turning sharply toward relative value—and away from overexposure to the United States.
“The narrative is shifting,” says Nigel Green.
“What we’re witnessing is a powerful repricing of risk. Investors are actively diversifying away from the US, and the ECB’s move today will only likely intensify that.”
He continues: “The US dollar has lost ground in recent months, retreating against a basket of major currencies as bond yields sink and confidence wanes.
“While the S&P 500 continues to edge higher, its performance masks underlying concerns.
“The US is now running an annualized deficit above $2 trillion, with interest payments on government debt nearing $1 trillion a year.
“The Congressional Budget Office projects America’s federal debt load will hit 122% of GDP by 2034—up from 97% just three years ago.”
Elsewhere, President Donald Trump’s aggressive tariffs and unpredictability on trade have introduced a new layer of geopolitical risk. With key trading partners retaliating and multinationals reconsidering global supply chains, some of the gloss has come off the traditional ‘safe haven’ perception of US assets.
“The trade war rhetoric has consequences. Investors are re-evaluating what it means to be overexposed to a single economy, especially one facing mounting fiscal and geopolitical headwinds,” explains the deVere Group CEO.
“They’re looking to Europe, the UK, and beyond, seeking balance, stability, and upside.”
The ECB’s cut underscores a broader appeal. While the US is still digesting the consequences of its fiscal binge and trade aggression, Europe is sending a signal: policy support is aligned with stability.
The weakening euro boosts export competitiveness, and easier financial conditions across the bloc stand to lift corporate margins and equity valuations.
“There’s a growing awareness that capital needs a more global footprint,” says Nigel Green.
“Europe is benefiting from a convergence of policy, valuation appeal, and investor pragmatism. That mix is drawing serious capital.”
The chief executive and founder also points to the comparative undervaluation of European equities.
“There’s still a discount on eurozone stocks compared to their US peers, despite improving fundamentals. That discount won’t last if this rotation continues gathering pace.
“For years, the gravitational pull of Wall Street was irresistible. But the combination of Trump’s economic nationalism, fiscal deterioration, and heightened currency volatility is causing a strategic rethink. Today’s ECB rate cut adds fuel to that process.”
He concludes: “We’re entering a cycle where diversification away from US assets is not just tactical, it’s structural. Global investors are beginning to act on that conviction.”