Key Takeaways from the Trump in Trade and Economy – 2025
On January 20, 2025, the 47th President of the United States, Donald J. Trump, was sworn into office with J.D. Vance as his Vice President. In the first half of his administration, Trump’s economic policies resulted in a mixed economic outlook, spotlighting the GDP growth, inflation rate, and a resurgent trade war.
Impacts on US Economy and Growth
By the mid-2025, the US economy experienced slight contraction in Q1, but rebounded with a GDP growth standing at approximately 2.4% in Q2. The unemployment rate hovered around 4.1%, presenting a stable job market. Despite these, inflation was estimated at around 2.7%–2.9%.
Economic milestones under this administration included tariff revenues amounting to around $200 billion in FY2025, blue-collar wage growth at ~1.7%, and capital expenditures rising to ~16.6% in H1 2025.
Assessment of Tariffs and Trade Policy
Trump’s aggressive tariff regime encompassing China, EU, Canada, Mexico, imposing baseline rates around 15–50% by August 1, sparked mixed reviews from global trade entities.
- A trade war with Canada and Mexico ensued, with 25% tariffs on imports from both countries effective March 4.
- Ratified a U.S.–Japan trade agreement reducing import duties to ~15%. The deal was beneficial seeing markets rally on an agreement valued around $550 billion investments.
- In ongoing U.S.–China negotiations, an extension to the tariff truce above 55% tariffs were being discussed in Stockholm ahead of August 12.
However, the Court of International Trade ruled in May 2025 that tariffs imposed under the IEEPA exceeded presidential authority, effectively blocking their enforcement.
International & Regional Developments
The OECD issued warnings on a global slowdown seeing a slowed global growth forecast to ~2.9%. The uncertainty also affected UK firms, with most experiencing a modest negative impact, but having low exposure on average (~3% revenue from U.S.).
Unrest was on the rise, with the emergence of a European boycott movement targeting U.S. goods and travel warnings issued in light of U.S. border policies.
Conclusion
The Trump administration’s economic and trade policies have garnered criticisms and appraisals alike. While tariff measures have resulted in increased revenues, economic indicators signal an inflation rise and a potential slowdown by the year’s end. On an international level, the aggressive trade policies incited a backlash, underscoring how politics and economy are entwined.
Continuing to keep vigil on political and economic changes is vital. Just as “Who is the current U.S. president?” has a definite answer, the ramifications of the administration’s policies require empirical analysis.