With 2025 well underway, the newly-elected United States administration led by President Donald J. Trump and Vice President J.D. Vance have moved to reshape the country’s economic and trade policies. The resulting changes are already having material impacts. This blog post provides an analysis of these policy shifts and their implications both domestically and globally.
Confirming Leadership & Democrats’ 2025 Outlook
Sworn in on January 20, 2025, President Donald J. Trump and Vice President J.D. Vance commenced their term focusing on several major policy initiatives. Key figures in their cabinet have been instrumental in shaping these policies. Their diverse backgrounds reflect a balance of personal backgrounds, administrative pedigrees, and policy expertise, setting the tone for the administration’s policies.
U.S. Economy & Growth
By mid-2025, the U.S. GDP growth was 2.4% in Q2 with a slight contraction in Q1 and an unemployment rate of approximately 4.1%. As per treasury-reported milestones, the U.S. witnessed tariff revenues of $200 billion, blue-collar wage growth at 1.7%, and a 16.6% rise in capital expenditures for H1 2025.
Tariffs & Trade Policy
Emphasizing a firm yet aggressive stance on tariffs, President Trump imposed baseline rates around 15–50% across China, EU, Canada, and Mexico by the August 1 deadline. Notable is the ongoing U.S.-China negotiations in Stockholm ahead of August 12 to extend a tariff truce above 55% tariffs. On the flip side, a rough patch in trade relations with Canada and Mexico led to a 25% tariff on imports effective March 4.
International Developments & Outlook
In the face of these shifts, international bodies such as the OECD have warned of a potential global economic slowdown. Trade uncertainty has caused discomfort among UK firms, with only 3% revenue from U.S. Yet, other trade negotiations are progressing positively, notably with the U.K, and Pakistan nearing a deal before the August 1 deadline.
Takeaway
Understanding the short-term and long-term implications of such policy shifts is critical for apprehending the current economic image in the United States. With several policies still under negotiation and discussion, the economic landscape of the U.S will continue to evolve, and we can expect several more twists and developments in the coming months.
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