Global Economic Outlook Amid Trade War

This technical report by Allianz Research outlines the economic implications of the recent trade war initiated by the US government, particularly focusing on the unprecedented tariff increases announced by President Trump. The report details the projected slowdown in global GDP growth, forecasting a decline to +2.3% in 2025, the lowest since the pandemic. It highlights the anticipated impacts on both developed and emerging markets, with specific attention to the US entering a mild recession and Europe experiencing lower growth due to increased trade restrictions. The report also discusses the cautious approach of central banks in response to rising inflationary pressures and the strategic responses of emerging markets to adjust tariffs and diversify imports. Furthermore, it presents the expected export losses for various countries and sectors, emphasizing the significant economic disruptions caused by the trade policies. Overall, the document provides a comprehensive analysis of the current economic landscape shaped by trade tensions and policy uncertainties.