World Bank slashes 2025 global growth forecast amid rising tariffs
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The news: The World Bank cut its 2025 global growth forecast by 0.4 percentage point to 2.3%, saying higher tariffs and heightened uncertainty pose a “significant headwind” for nearly all economies.
The numbers: Growth projections were lowered for nearly 70% of economies, including the United States and Europe, as well as six emerging market regions.
Global trade growth is forecast to slow to 1.8% in 2025, down from 3.4% in 2024 and far below the 5.9% average in the 2000s.
Inflation is expected to reach 2.9%, remaining above pre-COVID levels, the bank said. Global GDP growth through 2027 is expected to average just 2.5%, the slowest pace of any decade since the 1960s.
What they said: The bank warned that escalating trade barriers could result in “global trade seizing up,” a “collapse in confidence,” and “turmoil in financial markets,” though the risk of a global recession remains under 10%.
The sources: World Bank, Bloomberg
