Latest news with #protectionism
Daily Mail
2 days ago
- Business
- Daily Mail
BREAKING NEWS The US is heading for a sharp economic downturn, influential global organization warns
Donald Trump's aggressive trade policies has sent the global economy into a downturn, the OECD warned in a major report on Tuesday. The US economy will be among the hardest hit with growth slowing to 1.6 percent this year down from 2.8 percent in 2024, according to the group's new forecasts. The Paris-based organization also predicted that Trump's tariffs will hit the global economy harder than expected, slashing its growth forecast for the year down to 2.9 percent compared to 3.3 percent last year. The group, made up of the 38 wealthy nations, said that protectionism is also driving up inflation. 'Weakened economic prospects will be felt around the world, with almost no exception,' OECD chief economist Alvaro Pereira said in the report. 'Lower growth and less trade will hit incomes and slow job growth.' The situation could also deteriorate further if countries begin to retaliate against the US with their own steep tariffs, the group warned. Uncertainty from the rapidly changing policies is also hitting consumer confidence and holding back investment, according to the report. The OECD has called on governments to ease trade tensions and work to eliminate uncertainty. 'Agreements to ease trade tensions and lower tariffs and other trade barriers will be instrumental to revive growth and investment and avoid rising prices,' the OECD said. 'This is by far the most important policy priority.' The report comes as its members, including US trade representative Jamieson Greer, prepare to meet in Paris for their annual meeting. The OECD also criticized other key Trump policies including his vast reductions in the federal workforce and curbs on immigration, both of which are also dragging on the economy. The report also warned that the US budget deficit will expand further as weaker economic activity will override the gains made by spending cuts and revenue from tariffs.
CNA
2 days ago
- Business
- CNA
OECD cuts global GDP forecast amid tariff uncertainties, increase in trade barriers
Trade policy under US President Donald Trump is taking a major toll on global growth. The Organisation for Economic Co-operation and Development has cut its GDP forecast for this year and the next to below 3%. It has warned of an even weaker outlook, should it see a further rise in protectionism. The OECD's chief economist also said a "significant increase in trade barriers" and uncertainty caused will lead to "weakened economic prospects" all around the world. Olly Barratt reports from London.
Irish Times
2 days ago
- Business
- Irish Times
Trump's tariffs plunge global economy into slowdown
Donald Trump's trade policies have tipped the world economy into a downturn clouded in heightened uncertainty, with the US among the hardest hit, the OECD said. The Paris-based organisation slashed its global forecasts for the second time this year, citing the impact of the American president's tariff onslaught. The combination of trade barriers and uncertainty are hitting confidence and holding back investment, it said, while also warning that protectionism is adding to inflationary pressures. The OECD now forecasts global economic growth to slow to 2.9 per cent this year from 3.3 per cent in 2024. It expects the rate of expansion in the US will tumble further, to 1.6 per cent from 2.8 per cent – an outlook that is significantly lower than its projection in March. 'Weakened economic prospects will be felt around the world, with almost no exception,' Chief Economist Alvaro Pereira said. 'Lower growth and less trade will hit incomes and slow job growth.' READ MORE The assessment indicates how Trump's policies have become the most pressing problem for the global economy, with no easy solution in sight. The situation could yet be exacerbated by retaliation from US trading partners, a further erosion of confidence, or another bout of repricing on financial markets, the OECD said. The club of 38 rich countries published its forecasts just as its members' ministers convene in Paris for an annual meeting. Top commerce officials are expected there include US trade representative Jamieson Greer and EU trade commissioner Maroš Šefčovič. Lin Feng, a representative from China's Ministry of Commerce, is also scheduled to attend. 'Agreements to ease trade tensions and lower tariffs and other trade barriers will be instrumental to revive growth and investment and avoid rising prices,' the OECD said. 'This is by far the most important policy priority.' Yet the organisation also said that even if Trump reversed course on tariffs, the bonus in terms of growth and reduced inflation would not materialise immediately, due to a persistent drag from heightened uncertainty over policy. For the US, the OECD said curbs on immigration and a sizeable reduction in the federal workforce add to the trade-related drag on the economy. It also cautioned that the budget deficit will expand further as the effect of weaker economic activity will more than offset spending cuts and revenues from tariffs. Inflation in the US will also move higher this year, making it likely that the Federal Reserve will not resume easing policy until 2026, according to the OECD. That process may even be derailed if consumer-price expectations get de-anchored, it added. For other central banks, the OECD also urged continued vigilance. While it expects inflation to ease to their targets in 2026, that process will now take longer, and the pace of price increases may even increase before easing again, it said. Besides the fallout from global trade, the organisation also warned that fiscal risks are intensifying around the world, with 'tremendous' pressures for more spending on defence, climate and ageing populations. It called for governments to reduce non-essential spending and raise revenues by broadening tax bases. – Bloomberg
Bloomberg
2 days ago
- Business
- Bloomberg
Trump's Tariffs Plunge US and Global Economy Into Slowdown
Donald Trump's combative trade policies have tipped the world economy into a downturn clouded in heightened uncertainty, with the US among the hardest hit, the OECD said. The Paris-based organization slashed its global forecasts for the second time this year, citing the impact of the American president's tariff onslaught. The combination of trade barriers and uncertainty are hitting confidence and holding back investment, it said, while also warning that protectionism is adding to inflationary pressures.
Bloomberg
4 days ago
- Business
- Bloomberg
Hong Kong's 2025 Growth Outlook Cut by AMRO on Trade Uncertainty
Hong Kong's growth outlook was cut by a regional organization, which urged the city to diversify its economy and trading partners to counter growing protectionism. The Asian financial hub is set to expand 1.9% in 2025 from the prior year, according to the ASEAN+3 Macroeconomic Research Office (AMRO), a step down from the group's 2.4% forecast just last month.
