New WFE Research quantifies the impact of stock exchanges on economic growth

January 6, 2025--The World Federation of Exchanges, the global industry association for exchanges and CCPs (The WFE), has published new research which analyses the link between stock market development and economic growth on a global scale.
The research analysed quarterly data from 36 countries over two decades (2003-2022).

Key findings

Short term analysis:

There is a two-way influence between economic output growth and the stock market capitalisation in the short term, but only for high-income countries.

Low and middle-income countries experience a unidirectional relationship in the short term, where stock market capitalisation positively impacts economic growth, but not vice versa.

This means that low and middle-income country exchanges aren’t seeing a positive impact on their market capitalisation as a result of economic growth, though higher market capitalisation leads to higher economic growth.

IMF World Economic Outlook -Global Economy in Flux, Prospects Remain Dim October 2025

October 14, 2025-- While the near-term forecast is revised up modestly, global growth remains subdued, as the newly introduced policies slowly come into focus
The global economy is adjusting to a landscape reshaped by new policy measures. Some extremes of higher tariffs were tempered, thanks to subsequent deals and resets. But the overall environment remains volatile, and temporary factors that supported activity in the first half of 2025-such as front-loading are fading.