Macro Outlook 2025: Economic Projections and Risks

This report presents a macroeconomic outlook for 2025, focusing on anticipated changes in US economic policy under the second Trump administration. It outlines expectations for higher tariffs on China and the auto industry, reduced immigration, tax cuts, and regulatory easing. The report forecasts US GDP growth at 2.5% for 2025, while noting risks associated with potential across-the-board tariffs that could negatively impact growth. It also revises the Euro area GDP forecast down to 0.8% due to structural challenges and trade policy uncertainty. The report highlights a projected slowdown in US core PCE inflation to 2.4% and discusses expected interest rate cuts by the Federal Reserve and the European Central Bank. Additionally, it details the implications of US trade policies on global markets, particularly in Europe and China, where significant tariff increases are expected to affect growth rates. The analysis emphasizes the importance of monitoring trade policy developments and their potential economic impacts.