The International Monetary Fund (IMF) warns that President Donald Trump’s unpredictable tariff policy and countermeasures will deal a heavy blow to economies worldwide, particularly the US. The global economic growth is expected to slow to 2.8% this year, significantly below its historical average.
US prosperity is likely to be hit hard, with its economy growing only 1.8% in 2025, compared to a 2.8% expansion in 2024. The IMF attributes the slowdown to Trump’s tariff announcements, which have increased policy uncertainty and sharply downgraded US growth forecast for this year.
The IMF’s chief economist, Pierre-Olivier Gourinchas, notes that the long-term impact of tariffs will be negative for all regions. Central bank independence remains a cornerstone, and lowering borrowing costs now would risk pushing up inflation, which is already running above the target.
Inflation is expected to hit 3% this year, compared to the IMF’s January forecast of 2%. The latest World Economic Outlook report was put together under “exceptional” circumstances, with Trump’s unveiling of sweeping tariffs on April 2 forcing the IMF to jettison its projections.
The global economic system is being reset, and a ratcheting up of trade tensions could further reduce growth. However, de-escalation from current tariff rates and new agreements providing clarity and stability in trade policies could boost growth instead.
Source: https://edition.cnn.com/2025/04/22/economy/imf-us-global-economies-tariffs-intl/index.html