Understanding the Economic and Trade Policies of the 2025 U.S Administration

In the world of politics, change remains the only constant. Sworn in on January 20, 2025, Donald J. Trump is currently serving his second non-consecutive term as the 47ᵗʰ President of the United States, with J.D. Vance as Vice President, spearheading changes in economic and trade policies. This article aims to equip you with up-to-speed information on their policy initiatives and the current U.S. administration’s economic indicators.

U.S. Economy & Growth

The mid-2025 economic indicators report a GDP growth of ~2.4% in Q2, following a slight Q1 contraction. The unemployment rate hovers at ~4.1%, while the core CPI indicates an inflation of approximately 2.7%–2.9%. These statistics reflect the state of the economy under the current administration.

OECD forecasts suggest eventual growth settling at around 1.6%–1.7%, with inflation projected to rise to ~3.9% by year-end. Other markers highlight increased blue-collar wage growth of ~1.7%, a rise in capital expenditures by ~16.6% in H1 2025, and impressive tariff revenues approaching ~$200 billion in FY2025.

Tariffs & Trade Policy

Key to Trump’s strategy in this term has been an aggressive tariff regime imposed on several economies such as China, EU, Canada, Mexico, with baseline rates of around 15–50%, effective by the August 1 deadline. A major highlight was the US-Japan trade agreement that slashed import duties to ~15%, injecting a fresh breath of energy into the markets with deals valued around $550 billion.

However, this aggressive tariff policy has its setbacks. The Court of International Trade ruled in May 2025 that tariffs imposed under the IEEPA overstepped presidential authority, prohibiting their execution. The impact of this ruling on average household cost is projected to peak at ~$1,683 in 2026, with a predicted reduction in market income by ≈1.4%.

International & Regional Developments

The OECD has warned of a global slowdown due to the trade uncertainty. The U.S. growth figures subtly trimmed, inflation rising, and the global forecast slowing to ~2.9% in ’25–’26. The uncertainty also affected UK firms, with a panel finding a modest negative impact, albeit a low average exposure of (~3% revenue).

Simultaneously, trade negotiations are advancing with the U.K. and Pakistan, nearing deals before the August 1 deadline. However, a backlash is brewing in Europe, with a boycott movement targeting U.S. goods and travel warnings stemming from U.S. border policies.

Conclusion

Navigating through the fluctuating tides of the economic landscape, the current U.S. administration under the leadership of President Trump and Vice President Vance continues to make noteworthy policy decisions affecting economic and trade aspects both domestically and globally. As with any administration, it’s a balance of managing trade relationships, economic growth, household costs, and navigating legal challenges. These highlight the complexity and dynamism inherent in economic and trade policy.

Call to Action

Keeping yourself informed of current affairs can often offer important insights into the decision-making process at both the micro and macro level. Stay tuned for more well-researched, timely updates about the 2025 U.S. administration and its various policy initiatives.