National Institute Global Economic Outlook – Summer 2025

Ahmet Kaya (), Edmund Cornforth, Ian Hurst (), Iana Liadze (), Patricia Sanchez Juanino (), Stephen Millard (), Shama Bernard (), Barry Naisbitt (), Lea de Greef () and Monica George Michail ()

National Institute Global Economic Outlook, 2025, issue 19, 7-64

Abstract: Global GDP growth has been gradually slowing over the last couple of years, from 3.6 per cent in 2022 to 3.5 per cent in 2023 and to 3.3 per cent in 2024. We anticipated that this slowdown would continue six months ago with forecast growth rates of 3.2 per cent for both 2025 and 2026. However, President Trump’s tariffs have led us to expect even slower growth for the global economy. Since January, President Trump's imposition of tariffs has heightened uncertainty about the global trading environment (figure 3). Trade policy uncertainty increased during his first term as President and during Covid when supply chain difficulties emerged, but the new wave of tariffs marked a substantial increase in uncertainty. Although uncertainty indices have fallen since the announcement of tariffs, they remain well above the historical average, and President Trump's continued tariff announcements are expected to keep it elevated for longer.

Date: 2025
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