Buckle up for ‘tough 2025, warns chief economist

By: bitcoin ethereum news|2025/05/04 13:00:02
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Mark Zandi, Chief Economist at Moody’s Analytics, has warned about the U.S. economy’s near-term prospects, urging businesses and investors to “buckle up” for a challenging 2025. Zandi pointed to rising risks from escalating tariffs, a deepening trade war, and the increasing likelihood of a global recession, he said in an interview with David Lin published on May 2. The economist painted a grim picture, stating that the odds of a global recession beginning sometime this year now exceed 50%. “At best, the economy’s growth prospects have been diminished by the tariffs and trade war. We’re on the brink, and the longer this goes on, the more damage it will do,” he said. He emphasized that the uncertainty caused by current trade policies is eroding confidence and sentiment, potentially pushing the economy into a downturn. Zandi also noted that the economy’s future trajectory hinges on trade policy decisions. However, he expressed waning optimism, warning that prolonged uncertainty could become “too much to bear” for the economy. “If the administration can take an off-ramp, lower the tariffs, and de-escalate the trade war, we have a fighting shot at avoiding a downturn,” Zandi explained. Therefore, he predicted a “difficult six to 12 months ahead,” regardless of whether a full-blown recession occurs. Sectors to be impacted in a recession In his outlook, the combination of economic uncertainty and weakening growth prospects is expected to weigh heavily on real estate markets, which are already facing shifting demand and financing challenges. Notably, Zandi joins a growing number of market experts projecting a possible economic downturn driven by trade tensions. As reported by Finbold, JPMorgan CEO Jamie Dimon warned that rising U.S.-China trade tensions and lingering Trump-era tariffs could depress S&P 500 earnings and lead to a likely recession. At the same time, economist Steve Hanke estimated a 90% chance of a 2025 recession, while Bridgewater founder Ray Dalio issued an even starker warning, suggesting the U.S. could face deeper systemic challenges if the monetary system is not carefully managed. Meanwhile, with U.S. economic growth slowing in the first quarter, odds of a 2025 recession spiked on betting markets, rising as high as 72%. Featured image via Shutterstock Source: https://finbold.com/buckle-up-for-tough-2025-warns-chief-economist/

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