Tariffs and significant US policy uncertainty are expected to dampen global growth in 2025. Growth in the US will be subdued at 1.2% -1.5% with risk skewed to the downside. Even if the current reduced tariffs of 30% against China (with some exclusions) and a 10% across the board for other countries are implemented quickly, this still amounts to a tax hike of approximately 1.5% of US GDP, marking one of the largest single-year increases in decades. Tariffs and slower US growth imply slower growth for Asia and Emerging Markets (EMs). Countries in these regions with policy flexibility will be able to better withstand external shocks.
Read Eastspring’s 2025 Mid-Year Outlook
