A new report from Apollo chief economist Torsten Slok suggests that a sweeping “Liberation Day” tariff announced in April could lead to a recession in the US by summer. Slok now estimates the probability of this scenario at 90%. The tariffs, which President Trump has placed on Chinese imports, will likely disrupt global trade and lead to shortages of essential goods.
According to Slok, the flow of container ships from China to the US is expected to stop by mid-May, while trucking demand will halt by late May. This will result in layoffs in both trucking and retail, with many retailers filing for bankruptcy. The US economy is already showing signs of weakness, including decreased consumer confidence, lower CEO confidence, and reduced investment in new equipment.
Slok warns that a trade war can lead to stagflation, a combination of stagnant economic growth and rising inflation. With the current trade tensions, this scenario seems highly likely. A recession has been triggered by two major global events since World War II: the 2008 financial crisis and the 2020 coronavirus pandemic. The Trump administration’s tariffs could be the third such event in 17 years.
The impact of these tariffs will depend on how they are received by targeted nations, which may retaliate with their own trade measures. If this happens, it could exacerbate the economic downturn and lead to a recession.
Source: https://www.axios.com/2025/04/28/trump-tariffs-recession-china