Global Economic Outlook 2025-2026 Analysis

This technical report provides an updated economic and capital markets outlook for the years 2025-2026, focusing on the implications of the ongoing US trade war and its effects on global economic growth. It outlines the expected global GDP growth rate, which is projected to decline to 2.3% in 2025, marking the lowest level since the pandemic. The report details the anticipated mild recession in the US, alongside lower growth forecasts for Europe due to heightened trade restrictions. It discusses the cautious approach of central banks in response to inflationary pressures, particularly in the US, where inflation is expected to peak at 4.3%. The report also highlights the strategic responses of emerging markets to the tariff changes and the shifting dynamics in capital markets. It notes the expected rise in global insolvencies and the impact of policy uncertainty on investments. Overall, the document presents a comprehensive view of the economic landscape shaped by geopolitical tensions and trade policies.