US-based credit agency Fitch lowered its global GDP growth forecast to 2.3% for 2025 on Tuesday, down 0.3 percentage points.
“The new US administration has started a global trade war that will reduce US and world growth, push up US inflation and delay Federal Reserve rate cuts,” Fitch said.
“These rates are well below trend and down from almost 3% annual growth in 2023 and 2024,” it said.
“Fiscal easing in China and Germany will cushion the impact of higher US import tariffs, but growth in the eurozone this year will still be a lot weaker than forecast in the December GEO (Global Economic Output report).”
Fitch underlined that Mexico and Canada will experience technical recessions given their high US trade exposure.