ABN AMRO Investment Solutions
In Europe, short-term growth may stagnate due to weak confidence and competitiveness, but a rebound is expected in the latter half of the year, supported by ECB interest rate cuts and potential political stability.
Allspring Global Investments
We anticipate international growth will trend lower until mid-2025 as a number of countries, especially in Europe, continue struggling due to tighter fiscal policy and not-loose-enough monetary policy. Potential Trump administration–induced tariffs could hit growth in China and Europe over-proportionately.
Amundi Investment Institute
The global economy is expected to soften in 2025. The US economy will moderate due to cooling domestic demand and labour market conditions. Disinflation may persist, but inflation risks loom and the Fed may need to adapt to a potential shift in US policy. Europe is positioned for a modest recovery, with strategic investments in focus. Emerging markets are likely to continue to command a growth premium over developed ones, and Asia remains a major driver of growth.
Amundi Investment Institute
The global economic outlook is benign as monetary policymakers have curbed high inflation without triggering a recession. Abating price pressures will allow major central banks to cut rates further but the easing cycle will end well before policy rates reach pre-pandemic lows.
Apollo Global Management
The US economy has charted its own path in the post-pandemic world, and it is diverging from both its own historical performance in a context of higher rates as well as its historical correlation to other developed economies, especially Europe and Japan. We see this trend continuing in 2025.
AXA Investment Managers
For now, we don’t expect a recession in 2025 which should help deliver positive equity returns, while credit markets should provide attractive income opportunities.
Apollo Global Management
We believe US GDP growth will end 2024 at 2.8%. We see real GDP growth at 2.3% in 2025, mostly in line with consensus estimates as of this writing.
Bank of America
BofA forecasts “soft landing” in both the US (2.5% GDP growth) and China (4.5%), modest acceleration in Europe and Japan (GDP growth 1-1.5%); global inflation rates are forecast to fall, though US core CPI expected to rise above 3%.
Barclays Private Bank
The euro zone’s combination of low inflation, lower rates and a low base, could drive a significant improvement in GDP growth – albeit absolute expansion is likely to remain subdued – of around 0.7% in 2025, in our base-case scenario. The European “renaissance” could be further strengthened by the bloc’s outsized exposure to China if that country’s stimulus plans bear fruit and reignite its economy.
Barclays Private Bank
Whether it’s tax cuts, deregulation or new tariffs being imposed, they could all significantly alter the US growth trajectory. It’s important to remember that any impact may not be felt in 2025, though.
BCA Research
We expect Beijing to take continued incremental steps to support the Chinese economy and to avoid an economic collapse, but these measures are not likely to lead to a significant growth impulse for the global economy.
BCA Research
The European growth outlook was already weakening leading up to the US election, and it is likely to get worse under Trump, whenever he imposes tariffs. Trump’s election could ironically trigger reform in Europe, but Europe’s existing growth momentum alongside trade action next year and China’s response to it are likely to be the dominant cyclical drivers of the European economy.
BlackRock Investment Institute
Many leaders across developed economies are constrained – by inflation, low political support and, outside the US, lack of growth. We expect a sharp focus on national economic and security priorities, potentially at the expense of others.
BNP Paribas
We cut our 2025 GDP growth outlook for the euro zone and see near-term risks skewed to the downside as geopolitics and local political uncertainty weigh. However, US policies could prompt a bolder European policy response and thus a brighter medium-term outlook.
BNP Paribas
China is likely to make the fiscal and monetary moves required to meet the authorities’ minimum acceptable 4.5% GDP growth rate in the face of US tariffs.
BNP Paribas
Higher US import tariffs are likely to be particularly negative for growth in open EM economies.
BNP Paribas Asset Management
While we anticipate more stimulus from Beijing, it does not look likely there will be a major change in economic policy; Beijing will probably continue to focus on investment in new, developing industries rather than nurturing household consumption or bailing out property developers. We question whether these privileged sectors will be able to generate growth for the whole economy at the rate the authorities would like.
BNY
In Europe, we believe the impacts of falling interest rates and low and stable inflation on consumer spending will help deliver modest growth in 2025. However, the region’s high reliance on imported energy and the potential for supply disruptions amid rising geopolitical tensions remain a risk.
BNY
We anticipate that China’s economic growth will continue to slow, as headwinds, including real estate, demographics and geopolitical uncertainty, persist.
BNY
We expect to see the economy slow modestly before a renewal of activity ensues as the economy benefits from a further moderation of inflation and lower interest rates. We expect US growth for 2025 to range from 1.5% to 2.5%, in line with trend growth, marking the fastest growth rate among developed economies.
BNY
We believe the BOJ will continue its efforts to slow inflation while growth improves next year. We expect a weaker yen to support greater exports and an increase in wages to drive consumer spending. However, structural headwinds such as labor shortages and aging demographics will persist and limit the country’s growth potential.
Capital Economics
We expect a pick-up in growth in China over the first half of next year as fiscal and monetary support feeds through. But the economy is likely to slow over the second half when structural constraints reassert themselves.
Capital Economics
We now expect lower US GDP growth and higher inflation and interest rates next year as a result of Trump’s policies. However, with private sector balance sheets still strong, a soft landing remains the most likely scenario.
Capital Economics
We expect GDP in the euro area to expand by 0.8% in 2025 – a forecast that put us right at the bottom end of the consensus only a few months ago but no longer looks so outlandish. Growth in the UK is likely to pick up, albeit from a relatively low base.
Capital Economics
Economic growth will slow in many emerging markets, but in most cases the slowdown will be gradual. Even if the pace of its expansion is slowing, India will once again be the world’s fastest growing major economy.
Carmignac
One should not discard the potential of Chinese authorities to bring forward more easing, nor the capacity of European authorities to react at times of existential crisis. As such, contrarian plays may take over as local policy makers are forced to react.
Charles Schwab
While the Bank of Japan is likely to raise interest rates again in 2025, should the outlook for inflation remain above 2% supported by wage increases, the increase is unlikely to create a measurable drag on Japan’s economy.
Charles Schwab
Our overall outlook for global GDP growth in 2025 is likely to be similar to 2024 at around 3%. While economic growth in the world’s two largest countries, the US and China, is expected to slow next year—nearly everywhere else growth is expected to improve. Not one of the top 45 economies in the world are expected to be in recession.
Charles Schwab
Economic and earnings downturns in Europe in 2023-24 were followed by economic stimulus in the form of interest rate cuts, so a strong rebound in growth might be expected for 2025. But the acceleration is likely to be mild with economic and earnings growth improving yet remaining below average.
Charles Schwab
A continued slow recovery from recession in 2023 combined with a slight drag from tighter fiscal policy is likely to result in better, but still below average growth in the UK.
Citi
The combination of the adverse demand effects from US tariffs and increased uncertainty looks to skew growth a bit lower. But this should also provide scope for foreign central banks to be somewhat more stimulative than otherwise.
Columbia Threadneedle
China disappointed in 2024 and although we are now seeing that stimulus come through, will it be sufficient to drive sustainable higher economic growth? Coupled with challenges around its demographics and uncertainties over tariffs and global trade, there is some risk there.
Comerica
“Animal spirits” will likely boost consumer spending and job openings in the first half of 2025 as affluent consumers and businesses act on their good vibes. Comerica’s forecast accordingly raises the outlook for real GDP growth in 2025 and 2026.
Deutsche Bank
Our US economists believe the most likely scenario is that modest tax cuts, a strong deregulation push, and more supportive financial conditions will produce faster US growth in 2025, which they now see at 2.5% versus 2.2% previously.
Deutsche Bank
For China, our economists believe momentum has improved thanks to the recent expansionary macroeconomic policies. They expect 4.8% GDP growth in 2025. They anticipate that significant fiscal stimulus will be announced in March 2025 alongside the annual budget. However, the sustainability of the recovery is dependent on the property sector’s performance and the impact of US-China trade tensions.
Deutsche Bank
For Europe, the Trump victory appears overwhelmingly negative at face value, but it could shake the continent into more positive policy action over the medium term. For 2025, it’s too early for the positive scenario to be considered and the economic performance gap to the US will likely widen. In light of this, our economists have downgraded their growth forecast (0.8% in 2025) while lowering their inflation and ECB terminal rate forecast (to 1.5% by year-end 2025).
Deutsche Bank
For the UK, domestic and external headwinds are picking up heading into 2025. As such, our growth forecasts have edged lower to 1.3% for 2025 with the BOE now only cutting four times as inflation proves sticky.
DWS
We do not expect any pick-up in global economic growth, with 3.1% GDP growth being our expectation this year and in 2025 and 2026.
DWS
We do not expect a recession in any of the major economies, but rather steady, moderate growth. This is a very good environment for many asset classes.
Evercore ISI
Yield stabilization coupled with monetary and fiscal stimulus could provide support to a beleaguered China.
Fidelity
Growth, inflation and interest rates across the world’s biggest economies are liable to head in very different directions in the months ahead and there is far more doubt about those paths.
First Abu Dhabi Bank
We expect global economic growth to come in at around 3.2% this year, a similar rate of expansion as seen last year in 2024. Several low-income developing countries, have seen sizable downward revisions to their growth outlooks, while other (developed market) economies, namely the US, have seen their economic growth outlooks expanded.
First Abu Dhabi Bank
We continue to believe that the China economy will struggle to get even close to the government’s aspirational target of 5% real GDP growth and would forecast 4.1% as a more likely result over the coming 12 months as the hit from tariffs offsets (at least partially) the boost from stimulus.
First Abu Dhabi Bank
Our constructive view on US economic growth prospects for the year ahead are also founded on our expectation that productivity growth should remain significantly stronger than in other developed economies.
Goldman Sachs
Our baseline forecast remains essentially benign for the US: solid growth, cooling inflation and further non-recessionary rate cuts, alongside a range of policies that could be friendly to corporate earnings. While the US is a clear outperformer, non-US economies still see stable growth, falling inflation and monetary easing in our central scenario.
Goldman Sachs
Given the otherwise soggy growth outlook in Europe, the UK’s relative outperformance is likely to stand out and benefit a procyclical currency like the pound and other UK assets on a relative basis.
Goldman Sachs
Our European economists have downgraded their GDP forecasts across the region in anticipation of higher trade uncertainty, the ongoing pressures from China competition in key industries, and other spillovers. The ECB again is the primary and perhaps only institution that will need to respond, and a deeper rate cut path is the most likely outcome.
Goldman Sachs Asset Management
If they are implemented, more expansive, universal US tariffs may act as a drag on European economic growth, leading to faster and deeper rate cuts by the ECB if incoming data is worse than expected.
Goldman Sachs Asset Management
The US economy remains resilient heading into 2025. We lean toward a soft landing as our base-case scenario against a backdrop of late-cycle opportunities and lingering tail risks.
HSBC Asset Management
In advanced economies, we expect growth to converge. While the US economy shows some signs of cooling, the period of US exceptionalism that has characterized the post-pandemic economy may begin to fade. Europe is on a recovery path, but growth remains subdued. In contrast, Asia and frontier economies are projected to experience premium growth rates, with China benefiting from policy support and India maintaining its status as the fastest-growing large economy.
HSBC Global Private Banking
We continue to see better opportunities in the US than in Europe, due to relative levels of current growth, innovation and policy support. Despite increased trade uncertainty after the US elections, we expect Asian growth to stay resilient in 2025.
Invesco
The combination of falling inflation, central bank easing, and an increase in money supply suggests that the risks of an economic accident are diminishing. In the absence of significant shocks, we anticipate that recession will not be a concern in 2025, with economies more likely to be in recovery mode.
Invesco
Global GDP growth will recover towards trend, global inflation will fall towards central bank targets, and major western central banks will continue cutting rates towards “neutral.”
Janus Henderson
In the US, the benefits of rate cuts and a resilient economy are countered by an uneven labor market, the threat of higher long-term rates, and the policy uncertainty that comes with a new administration. Meanwhile, major economies outside the US struggle to find their footing with a mix of hot and cold data across Europe and Asia.
JPMorgan Asset Management
Japan is moving out of a long period of deflation, stagnant nominal growth and negative rates. In the year ahead, reflation should support consumer spending and domestic earnings more broadly. Yen stability, which is crucial for internationally exposed companies and foreign investors, is expected to improve.
JPMorgan Asset Management
In 2025, investors may be disappointed by the scale of Chinese fiscal policy stimulus and hence overall economic growth.
JPMorgan Wealth Management
In past rate-cutting cycles, falling rates have supported emerging market assets through higher growth, increased capital flows and weaker currencies that boost exports. But we take a more cautious view. We expect developed market equities to outperform their EM counterparts in 2025, as they have for eight of the past 10 years. EM economies face a host of challenges. Most importantly, China confronts a crisis of consumer confidence (only slightly eased by the government’s recently announced stimulus package).
JPMorgan Wealth Management
We believe 2025 will be the year of the global easing cycle. Falling policy rates will support trend-like economic growth in the US and the euro zone, but not boost demand so much that it reignites inflation. In China, policymakers seem set on ensuring that growth stabilizes, especially in response to the increased likelihood of higher US tariff rates.
LGIM
We are cautious on the UK. The recent tax-raising budget appears to have dented business confidence and pushed up interest rates, which could offset any growth boost from increased government spending. If the UK gets caught in a global trade war, the Bank of England might need to deliver a faster pace of easing than markets currently anticipate.
Lombard Odier
The outlook for emerging markets has dimmed amid a more negative outlook for exports and growth, a stronger US dollar and weaker EM currencies. Yet economic fundamentals across EM including external balances have improved, helping limit stresses.
Lombard Odier
Japan is on a different trajectory from other major economies. Lombard Odier sees growth expanding to around 1.4%, helped by weaker fiscal discipline from the minority government, more consumer spending, improving business sentiment and corporate reforms starting to bear fruit.
LPL Financial
The economy will likely downshift throughout 2025 as consumer spending begins to moderate, though pent-up demand for business capital expenditures, favorable tax policy, and likely deregulation could help offset some of the softening.
Morgan Stanley
Restrictions on immigration, which may make labor market conditions less favorable, are also expected to have a negative impact in the latter half of 2025.
Morgan Stanley
Major policy changes are often announced quickly and achieved more slowly, so the current benign macroeconomic conditions may persist well into 2025 without significant disruption.
NatWest
We predict four more ECB cuts in the first half, bringing the policy rate down to what we think is a terminal 2%. Inflation expectations also point to around 2%, with the ECB’s expectations now just above 2%. While there are good reasons to expect a re-acceleration in European output growth in the coming quarters, recent surveys have surprised with less impressive data, dampening our view of a rebound in 2025.
Ned Davis Research
Our inflation forecast (2.75%-3.25%), GDP expectations (2.0%-2.5%, with a slower second half), Fed policy uncertainty, EPS projection (8.4%), 10-year yield outlook (4.625% fair value), potential for tariffs and deportations, and the presidential cycle suggest the risks increase in the second half.
Neuberger Berman
Countries and governments that deliver moderate inflation and broader participation in positive real wage growth and positive real revenue growth will increasingly come to define success, visible in data points such as higher consumer confidence, political approval ratings and GDP growth rates. While it remains to be seen whether specific policy mixes can achieve this, we see evidence that the incoming US administration at least recognizes the objective, and active industrial policy is evidence of growing recognition elsewhere.
Northern Trust Asset Management
Japan’s economic growth in 2024 was unspectacular, but wage gains that may support consumer spending are spreading across the economy and those gains may continue into 2025.
Northern Trust Asset Management
In Europe, the economic picture straddles growth and contraction. A resilient labor force and target-level inflation is coupled with manufacturing sector contraction and risks of further geopolitical tensions and trade barriers.
Northern Trust Asset Management
In Asia, while the overall optics are for favorable growth, the outlook for China remains a central concern, with economic growth falling short of the government’s 5% target. A slowing economy is deepening a deflationary loop.
Nuveen
Outside of the US, we are increasingly cautious toward both developed and emerging markets based on relative economic growth prospects and the likelihood of a stronger dollar. One exception is Japan, given the country’s emergence from deflation and solid real wage growth.
Pictet Asset Management
We are more cautious on the euro zone. Although economic growth appears to be stabilising, it is still lacklustre and could be significantly impacted by Trump’s tariffs (particularly in manufacturing-heavy Germany). The region is also less focused on tech and related industries than the US, so may lag as the AI revolution continues. Moreover, political uncertainty in both France and Germany means it is unlikely that the region would, in the near term, be able to produce a coherent and credible growth strategy.
Pictet Asset Management
In Japan, we expect a domestic consumption-led recovery in economic growth through next year and continued progress on corporate governance reforms, offering some support to the country’s financial markets.
Principal Asset Management
US economic growth is set to remain above trend, at least in the first half of 2025. Prospects for deregulation under the new administration provide an important boost to business sentiment, reinforcing the constructive backdrop for the jobs market.
Principal Asset Management
China’s growth is set to underperform once again. The bleak outlook remains rooted in a vicious cycle of deflationary risks, high unemployment, consumer caution and property market weakness. High hopes for a policy stimulus bazooka have faded, but fiscal expansion should at least put a floor under economic weakness.
Robeco
In the US, procyclical monetary policy is joining procyclical expansionary fiscal policy, a powerful policy mix underpinning US exceptionalism. We also believe Trump’s corporate tax cuts will add jobs and growth.
Robeco
The peak misery from the global tightening cycle is behind us, especially in Europe. We find that after peak misery a cyclical rebound in European consumption gets underway which is likely to accelerate in 2025.
Robeco
A mix of Chinese monetary and fiscal stimulus only pushes growth back to its (declining) trend growth path, removing downside risks yet failing to eliminate disinflationary pressures as output gaps remain negative.
Societe Generale
With permanently (very) high fiscal deficits, the growth outlook overall was always going to be robust regardless of who had won the US election. We can now expect an upsurge in the use of industrial policies that are a key part of the global trade war. That’s likely to become an increasing hurdle to other regions. We act accordingly in our allocation.
T. Rowe Price
US exceptionalism has not run out of steam. The US economy is set for another year of growth, bolstered by investments in AI. Fiscal policies and coordinated monetary easing support this outlook. Job creation will likely slow as companies have front-loaded hiring, but unemployment is expected to remain low. Improving productivity should also provide another boost to growth.
Tallbacken Capital
Structural forces reinforce the ongoing shift to higher nominal GDP. Re-localization of supply chains, the energy transition, and AI will all continue to reinforce fixed asset growth and help reinforce economic growth.
TD Securities
Europe faces perhaps some of the biggest challenges in 2025, with geopolitics almost certain to have a negative impact on growth. Europe will be hit by US tariffs and China dumping its goods in response to US tariffs. The ECB will cut below neutral to 2% by June, while stickier inflation will see the UK cut more cautiously, pausing at 3.5% from August.
TD Securities
A Trump presidency means higher US inflation and weaker global growth. We expect more bark than bite for the most part, so while we work in higher inflation from tariffs and a (limited) labour shock from migration policies in the US, we factor in only mildly weaker growth in key trading partners.
Truist Wealth
We anticipate steady growth on shifting ground for the US economy, which should remain the shining country on the global stage. The recovery will turn five early in 2025, and the evidence suggests we are in a mid-cycle transition with expected growth near 2.5%.
UBS
In Europe growth is likely to be uneven and subdued, but it should improve as wage growth remains strong while interest rates fall. Spain, the UK, and Switzerland should outperform with growth rates above 1%, compared to more modest growth of around 1% in Germany, France and Italy.
UBS
China’s growth is likely to slow, with reactive fiscal stimulus measures unlikely to be sufficient to fully offset the impact of tariffs and structural challenges. India is expected to continue to deliver more robust growth.
Vanguard
While inflation is now close to target in the euro area, that has come at the price of stagnation in 2023 and 2024, with muted external demand, weak productivity, and the lingering effects of the energy crisis holding activity back. Growth is expected to remain below trend next year, as a slowdown in global trade represents a key risk. Expect the ECB to cut rates below neutral, to 1.75%, by the end of 2025.
Vanguard
We maintain our weaker-than-consensus secular view on Chinese growth. Growth should pick up in the coming quarters as financing conditions ease and fiscal stimulus measures kick in. But more decisive and aggressive measures are needed to overcome intensifying external headwinds, thus we expect additional monetary and fiscal loosening in 2025.