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The Index, which leverages advanced machine learning to track sentiment across thousands of headlines in near real time, reveals a pattern of persistent volatility with minimal recovery periods. This signals heightened risk conditions for markets, institutions and policymakers alike.

Key Insights

• Volatility is now the norm: The Index highlights continuous swings in political sentiment, reflecting embedded instability that extends well beyond one-off crises.
• Trade tensions remain the primary trigger: Sentiment plunged during the US-Canada tariff dispute (Feb 2025) and again following Trump's tariff policy announcements (Apr 2025), signalling how protectionist economic measures continue to drive global unease.
• Diplomatic progress offers only fleeting stability: Temporary sentiment rebounds linked to the US-UK trade deal and global tariff talks (May 2025) were quickly reversed, highlighting a fragile geopolitical outlook.
• Public figures and leadership events are key sentiment drivers: The Index recorded a sharp spike after Trump's inauguration (Jan 2025) and a steep decline following the Trump-Musk fallout (Jun 2025), revealing how individual personalities are influencing.

Wilson Chan, Permutable CEO commented, "Our data shows that political risk is no longer episodic - it's become systemic. Investors are operating in a sentiment-driven environment where trade policy and public figures can have immediate and far-reaching impacts on market confidence. The Political Tension Index provides an essential early indicator to help hedge funds, risk managers and policy strategists stay ahead of these shifts."

"Looking ahead, we expect political volatility to remain elevated through the second half of 2025, said Jack Watson, market analyst at Permutable. "With upcoming elections, unresolved trade tensions, and continued scrutiny of political leaders, the environment remains highly reactive. Markets are likely to stay sensitive to sentiment-driven headlines, which could directly affect commodity pricing, equity markets, and broader global risk appetite into 2026."

About the Political Tension Index
Permutable's Political Tension Sentiment Index uses advanced natural language processing to extract sentiment signals from thousands of global media headlines. It tracks public mood related to governance, diplomacy, trade disputes, controversies and leadership perception, offering investors a clear lens on global political instability.

About Permutable
Permutable provides real-time global market data intelligence to institutional investors and risk professionals. Its AI-powered tools extract and interpret insights from news media, macroeconomic indicators and geopolitical signal - enabling faster and more informed strategic decisions through its specialist plug and play intelligence solutions.

Press release

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