#dieWIRTSCHAFTSPRAXIS-VW.THINKTANK I STATUS.QUO Q2/2025

’Tis the season for 2025 outlooks, and JPMorgan Chase’s research team has published theirs. The bottom line: “moderating but strong global growth” — except in China — with a heightened focus on US trade, immigration, fiscal and regulatory policies.

World GDP will rise 2.2%, measuring the fourth quarter of 2025 with the final quarter of 2024 — down from 2.7% this year, the bank says. The US sees a 2% increase after a 2.4% gain. China, hit by a likely trade-war renewal with the US, sees growth slump to 3.2% from 4.8%, the JPMorgan team wrote in a report Tuesday. Euro area GDP rises 0.7% after 1.1%.

“The backdrop of policy uncertainty, combined with geopolitical risks, however, suggests increased macroeconomic volatility and a wider range of potential outcomes,” Hussein Malik, head of global research, wrote. (BLOOMBERG I 04.12.2024)

US Data Dump “Animal spirits” have engulfed the markets since the election of Trump and the Republican sweep in US Congress, fueled by the prospect of business-friendly deregulation and low taxes.

But an onslaught of data last week ahead of the Thanksgiving holiday in the US provided a clear-eyed look at where the economy actually stands right now. Here are some takeaways:

1) Consumer spending remains solid but recent trends in real disposable income point to a slowdown after what Stephen Stanley at Santander US Capital Markets called “the extraordinary run in 2023 and so far in 2024.” 2) The outlook does look good for high-income households, however: the surge in equities and the likelihood that temporary tax cuts enacted under Trump will be extended means high earners will probably continue to splurge — and keep driving economic growth. 3) The equities rally in the run-up to the presidential election (aka Trump trade) added 0.24 percentage points to the year-over-year growth of the Federal Reserve’s preferred gauge of inflation last month. The culprit is a financial services category in the core personal consumption expenditures price index that mirrors markets moves and contributed in large part to the October acceleration in the index. 4) A spike in homes sales at the end of the summer and early in the fall was probably short-lived. A leading indicator of pending purchases rose in October to the highest since March, boding well for November. But with borrowing costs trending higher again and weak mortgage applications, “we think that home sales will drop back to rock-bottom levels around the turn of the year,” Pantheon Macro economists wrote in a note. 5) Early reports from Black Friday suggested that crowds were smaller than expected at some at some high-profile retail stores such as Macy’s flagship in New York City. But online sales were strong, underscoring a fundamental lesson of US economics: Never underestimate the American consumer.