The Fitch International Rating Agency has worsened the world economy's growth forecast in 2025 to 2.3% compared to 2.6% expected in December. According to the agency, in 2026, global GDP growth can be 2.2%.
According to the forecasts, the US economy in 2025 will increase by 1.7% instead of previously expected 2.1%, and in 2026 - by 1.5% instead of the previous 1.7%. Agency analysts say that this decline is partially related to the Global Trade War, which was launched by a new US government. This situation will slow down the growth of both the world and the US economy, accelerate inflation in the states and slow down the rate of interest rates of the federal reserve.
At the same time, the mitigation of tax policy in China and Germany can mitigate the negative effects of increasing customs tariffs for imports in the United States. However, it is expected that economic growth in euro area will remain much weaker than expected in December.
Agency analysts warn that Mexico and Canada may encounter a technical recession because of their close trade in the United States.
Fitch also reports that the import duties (ETR) in the United States increased to 8.5% compared to 2.3% in 2024. Imports from Europe, Canada, Mexico and other countries are expected to increase to 15% this year, and it will reach 35% for China. As a result, the total ETR indicator can increase up to 18%this year, and next year it will be reduced to 16%. It will be a record value over the last 90 years.
The agency estimates that duties will increase consumer prices in the United States, reduce real salaries and increase enterprise costs. In addition, this will have a negative effect on business moods.
The Fitch model assumes that the increase in duties will slow down the growth of the US, China and Europe economies by about one percentage by 2026 and will increase the level of inflation in the United States by one percentage point.
Due to such economic forecasts, the agency expects the Federal Reserve to set aside the next decrease in the rate by the fourth quarter of 2025. In 2026, the Fed can reduce the rate three times due to the weakening of economic growth.
