S&P Global Adjusts US Economic Growth Expectations

S&P Global Ratings has made a significant adjustment to its US GDP forecast for 2025, reducing it by 50 basis points to a modest 1.5 per cent. Concurrently, the agency has raised its inflation expectations, signaling a cautious outlook for the near future.

Global Economic Slowdown Concerns

While acknowledging increased risks across all regions, S&P does not anticipate a substantial deceleration in growth. "We observe a noticeable slowdown in growth, yet a US recession is not on our radar at this moment," stated S&P, as reported by ANI.

Impact of US Trade Policies

The revision comes in the wake of uncertainties spurred by recent US tariff announcements. S&P has also adjusted growth projections for other major economies, including India, Canada, and China, citing a "seismic shift in US trade policy" as a contributing factor to global economic unease.

Expert Insights on Economic Forecasts

Paul Gruenwald, S&P Global Ratings' Chief Economist, highlighted the potential repercussions of escalating trade tensions: "The real economy is poised to react, but the extent remains uncertain." The agency warns of downside risks and calls attention to the uncertain future role of the US in the global economy.

Looking Ahead

Amidst these developments, President Donald Trump's firm stance on tariff reciprocity underscores the ongoing trade tensions. With tariffs temporarily on hold, the global community watches closely for potential resolutions. S&P's updated forecasts underscore the delicate balance between growth and protectionist policies.