Latest news with #InterimEconomicOutlook
IOL News
29-04-2025
- Business
- IOL News
Investment Perspectives: Q1 shows signs of global economic weakness amid trade fragmentation
US President Donald Trump. Image: Erin Schaff / Getty Images / AFP By Mark Phillips The global economy showed resilience in 2024, but signs of weakness are emerging against a backdrop of slower growth, persistent inflation, and an uncertain policy environment, according to the OECD's latest Interim Economic Outlook. The report highlights risks, notably that further tradefragmentation could harm global growth outlook projects global growth slowing to 3.1% in 2025 and 3.0% in 2026, with significant regional variation. Inflation is expected to remain higher than previously forecast, though still moderating asgrowth slows. The US economy entered 2025 in good shape, marked by cooling inflation, solid growth, andexpectations of rate cuts. However, US consumer sentiment dipped in January for the first time in six months, hitting a three-month low, driven by growing concerns about unemployment and the inflationary effects of the new tariffs. The escalation of trade tensions between the US and China has heightened fears of a global economic slowdown, underscoring how ongoing trade disputes could hamper global growth. Uncertainty surrounding the US economic outlook is at its highest since the COVID-19 pandemic. Abroad implementation of tariffs would likely raise inflation risks, depress equities, and potentially impede US economic growth. South Africa The outlook for South Africa remains mixed. Figures released in March 2025 showed disappointing GDP growth in 2024, with the economy expanding just 0.6%, below expectations of over 1%. The South African Reserve Bank's Monetary Policy Committee cut the repo rate by 0.25% in January 2025 but opted to hold it steady in March, reflecting growing concerns about the global outlook and potential tariff impacts. A historic event in Q1 2025 was the postponement of the National Budget, exposing tensions within the coalition government. The delay sparked by disagreements over the proposed VAT increase, highlighted misalignment among partners in the Government of National Unity on key economic policies. Video Player is loading. Play Video Play Unmute Current Time 0:00 / Duration -:- Loaded : 0% Stream Type LIVE Seek to live, currently behind live LIVE Remaining Time - 0:00 This is a modal window. Beginning of dialog window. Escape will cancel and close the window. Text Color White Black Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Background Color Black White Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Transparent Window Color Black White Red Green Blue Yellow Magenta Cyan Transparency Transparent Semi-Transparent Opaque Font Size 50% 75% 100% 125% 150% 175% 200% 300% 400% Text Edge Style None Raised Depressed Uniform Dropshadow Font Family Proportional Sans-Serif Monospace Sans-Serif Proportional Serif Monospace Serif Casual Script Small Caps Reset restore all settings to the default values Done Close Modal Dialog End of dialog window. Advertisement Next Stay Close ✕ What will Trump 2.0 mean for economic policy? The global outlook has deteriorated due to harsher-than-expected US tariffs, raising the risk of slowergrowth, higher inflation, and potential recessions in export-dependent economies. The Trump tariffsrepresent one of the most significant disruptions to global trade in decades. Federal Reserve Chair Jerome Powell has warned that Trump's tariffs could fuel higher inflation and slower growth. A weakening US outlook poses risks to global economic prospects. Accordingly, the outlook remains uncertain, with fears of a possible US recession. It is important to note that this situation remains fluid. We are actively tracking US-China trade relations and global economic indicators. We remain vigilant in navigating political risks in the months ahead. Closely monitoring developments in US trade policy and their implications for emerging markets will be key. Mark Phillips is the head of portfolio management and analytics at PPS Investments. Image: LinkedIn
Yahoo
23-03-2025
- Business
- Yahoo
Borderlands Mexico: Tariffs could lead Mexico into recession, report says
Borderlands is a weekly rundown of developments in the world of United States-Mexico cross-border trucking and trade. This week in Borderlands: Tariffs could lead Mexico into recession, report says; Echo Global Logistics expands operations in Mexico; Americold acquires logistics facility near Houston; and GM agrees to 10.25% wage increase at Mexican plant. Mexico's economy could be the most affected by an escalating global trade war, leading the nation into a recession by the end of the year, the Organization for Economic Cooperation and Development says in a report. The OECD's 'Interim Economic Outlook,' released Monday, predicted Mexico could fall into a recession with a 1.3% contraction in GDP in 2025. That compares to a GDP growth forecast of 1.2% the OECD estimated in a report released in December. 'The overall picture is one of generalized downgrades partly because of trade uncertainty and economic policy uncertainty, but also the imposition of tariffs,' Alvaro Pereira, the OECD's chief economist, said during a news conference on Monday. 'We're already seeing high trade uncertainty and economic policy uncertainty. This is already having an impact on confidence. We have downgraded almost every single country.'The OECD, based in Paris, has 38 member countries – including the U.S., Canada and Mexico – that promote economic growth and sustainable development through public policies. Its latest economic forecast hinges on the Trump administration going forward with 25% tariffs on imports from Canada and Mexico, as well as implementing broad reciprocal tariffs on other nations on April 2. The tariffs could 'sap confidence and add to the downward pressures on corporate and household spending around the world,' the OECD said in its latest report. Mexican President Claudia Sheinbaum said her administration does not anticipate a recession.'They think we're not going to do anything in the face of an international situation, but we work every day to address that situation. We don't have that expectation because we have a plan and we're working to strengthen the economy from the bottom up,' Sheinbaum said Wednesday during her daily news conference. As of Thursday, outbound truck volumes out of Laredo, Texas, are up compared to last year but down significantly compared to the same periods in 2023 and 2022, according to the SONAR Outbound Tender Volume Index ( The Laredo port of entry is the No. 1 international gateway for trade between the U.S. and Mexico, though it was ranked No. 4 overall in the nation in January, the port of entry's lowest ranking since 2018. Trade at Port Laredo totaled $27.9 billion in January, an 11% year-over-year increase. President Donald Trump has already imposed 25% tariffs on all steel and aluminium imports from all countries, along with a 20% duty on Chinese goods. Canada and Mexico could face broader 25% tariffs on April 2 after a roughly 30-day pause was announced March 6. For the past 17 days, importers weren't required to pay tariffs on imports from Canada and Mexico that adhered to the United States-Mexico-Canada Agreement. Trump has called April 2, when the tariff policy is to be revealed, 'Liberation Day,' and would include broad reciprocal tariffs to match duties that other countries charge on U.S. imports.'April 2nd is Liberation Day in America!!! For DECADES we have been ripped off and abused by every nation in the World, both friend and foe. Now it is finally time for the Good Ol' USA to get some of that MONEY, and RESPECT, BACK. GOD BLESS AMERICA!!!,' Trump posted on Truth Social on Friday. The OECD's growth projection for Canada was also lowered. The forecast is for only a 0.7% increase in GDP in both 2025 and 2026, down from a previous forecast of 2%. China's economy will grow by 4.8% this year before slowing to 4.4% in 2026, the OECD said. Growth in the U.S. has also been downgraded: 2.2% expected this year and 1.6% in 2026, down from previous forecasts of 2.4% and 2.1%, respectively. Supply chain services provider Echo Global Logistics has expanded operations in Mexico City to support cross-border customers. The Chicago-based company opened its first office in Mexico City in March 2024 and named Troy Ryley president of Echo Mexico. 'We're excited to continue to develop our cross-border solutions with the opening of our Mexico City division headquarters,' Doug Waggoner, Echo's CEO, said in a news release. Echo Global Logistics also has locations in Monterrey, Mexico, and Laredo, Texas. The company now has 29 operations across the U.S. and Mexico. In addition to Laredo, Echo has Texas operations in Houston and Dallas. Atlanta-based Americold has acquired a 10.7 million-cubic-foot cold storage warehouse in Cedar Port Industrial Park in Baytown, Texas. The facility was acquired for $127 million and adds 35,700 pallet positions to Americold's cold storage warehouse portfolio. 'The catalyst for this acquisition was the award of a large grocery retail contract with one of the world's largest retailers,' George Chappelle, CEO of Americold, said in a news release. Baytown is 29 miles southeast of Houston. Americold (NYSE: COLD) owns and operates 239 temperature-controlled warehouses around the world, and manages approximately 1.4 billion refrigerated cubic feet of storage space internationally. Mexico's National Independent Union of Automotive Industry Workers announced an agreement for wage increases of up to 10.25% at the General Motors plant in Silao, Mexico, according to El Economista. Workers in four categories who make up more than 60% of the plant's workforce will receive a 10.25% raise, while the remaining 40% will get 9.25%. The GM plant in Silao produces Chevy Silverado and GMC Sierra pickup trucks. The factory employs 8,745 workers, according to the union. The 2024 average wage in Mexico for an unskilled factory laborer is around $4.18 per hour, according to Tucson, Arizona-based Tetakawi, a provider of services for foreign manufacturing companies in the country. The post Borderlands Mexico: Tariffs could lead Mexico into recession, report says appeared first on FreightWaves.
