Introduction
Adapting to a rapidly changing global setting, U.S. administration under President Donald J. Trump, inaugurated for a second non-consecutive term on January 20, 2025, is shaping the nation’s trade and economic policies. Amid swirling veils of uncertainty and potential repercussions, its impact on the national and international economic landscape is significant. In this meticulous blog post, we will wade through the complexities of the current U.S. administration’s economic policies, trade strategies, and forecasted international outlook.
U.S. Economy: Today and Tomorrow
Mid-2025 saw a resilient U.S. economy with a GDP growth of nearly 2.4% in Q2, notwithstanding a slight Q1 contraction. Unemployment levels lingered around 4.1% with an inflation CPA of approximately 2.7%–2.9%. According to OECD forecasts, by late 2025, GDP growth may stabilize between 1.6%-1.7%, with inflation inching up to 3.9%. Notably, treasury-reported milestones marked tariff revenues touching nearly $200 billion in FY2025, alongside a steady wage growth of 1.7% among blue-collar workers, and a surge of capital expenditures by almost 16.6% in H1 2025.
An Aggressive Stance on Tariffs & Trade
Trump’s administration took a combative approach to tariffs, implementing baseline rates of 15–50% across China, EU, Canada, and Mexico. This aggressive tariff strategy has been under negotiation with key international players. At the U.S.–Japan trade agreement, a pathbreaking deal reduced import duties to around 15%, stimulating much-needed market positivity. Regrettably, the Court of International Trade in May 2025 ruled that these tariffs, imposed under the International Emergency Economic Powers Act (IEEPA), exceeded presidential authority, thereby impeding their execution.
Repercussions on International & Regional Front
OECD warnings indicate a global economic slowdown with the U.S growth being trimmed, inflation rising, and a global forecast decelerating to about 2.9% in ’25–’26. In the UK, businesses have experienced a lukewarm impact due to trade uncertainty, with the average revenue from U.S imports standing around 3%. Social/political backlash has also emerged in Europe, with a boycott movement aimed at U.S. goods escalating and travel warnings over U.S. border policies being issued.
Conclusion: Navigating Through Uncertainty
In these unpredictable times, the U.S. administration under President Donald J. Trump has adopted a tough stance on global trade and economic policies. While it remains to be seen how these actions will impact the macro economy, one thing is certain – the world is watching closely. As we navigate through the capricious winds of change, it is imperative for us to stay informed and prepared for what lies ahead.