An economic forecast is a prediction of an economy’s future direction. Economists use a wide variety of tools to produce forecasts, from simple charts and tables to complex computer models. They publish them as reports, which usually include commentary and data visualization tools to help readers understand the results of their work.
The global economy is expected to slow slightly in 2024 and 2025 compared with last year’s pace, as rising tariffs weigh on growth globally. Economic activity in advanced economies is expected to remain solid, but is likely to slow from the acceleration fueled by lower interest rates and fiscal expansion in some major jurisdictions. In emerging markets and developing economies, growth is expected to decelerate as the effects of front-loading ahead of tariffs and retaliatory trade actions wane.
In the US, economic activity is expected to decelerate from the robust pace logged in Q2 as demand reverts to more normal levels following a strong push-forward of purchases that was intended to front-load imports before potential restrictions took effect. This pull-forward will likely linger, dampening business investment and crimping consumer spending in the months ahead. However, further progress on a trade deal and a fading impact from tariffs, along with more deregulation and gains from artificial intelligence, could bolster business confidence and unleash household demand in the second half of 2025.
Inflation is likely to continue losing steam globally, as elevated central bank rates and a withdrawal of fiscal support from high debt erode price pressures. However, in the US, inflation is expected to stay above target.