Donald Trump has refused to rule out an American recession. He ‘hates to predict things like this’, he said yesterday. When asked if a downturn was coming this year, the President responded that a ‘period of transition’ was on the cards.
On Thursday last week the Atlanta Fed’s GDP ‘nowcast’ model was forecasting that America’s economy would shrink by 2.4 per cent in the first quarter of this year – a slight improvement on the 2.8 per cent contraction it had predicted three days earlier. If this reading for the first three months of 2025 proves to be true, and things don’t pick up shortly, could the USA be heading for recession?
Analysts began to get particularly fearful about the health of the American economy two weekends ago when President Trump confirmed 25 percent tariffs on Mexico and Canada, followed by an additional 10 per cent on China (which already faced levies of 10 per cent on all goods).
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