Goldman Sachs Research is forecasting another solid year of global economic growth in 2025.
Economists at the renowned US firm project that the US will outperform expectations while the euro area lags behind amid fresh tariffs anticipated from the Trump administration.
Worldwide Gross Domestic Product (GDP) is predicted to expand 2.7% next year on an annual average basis, just above the consensus forecast of economists surveyed by Bloomberg and matching the estimated growth in 2024.
US GDP is projected to increase 2.5% in 2025, well ahead of the consensus at 1.9%.
The euro area economy is expected to expand 0.8%, compared with the consensus of 1.2%.
China’s economy will however expand by 4.0%, whilst India will record 6.7% GDP growth rate.
“Global labor markets have rebalanced,” Goldman Sachs Research Chief Economist Jan Hatzius wrote in the team’s report, which is titled “Macro Outlook 2025: Tailwinds (Probably) Trump Tariffs.”
“Inflation has continued to trend down and is now within striking distance of central bank targets,” Hatzius said. “And most central banks are well into the process of cutting interest rates back to more normal levels.”
US, the world’s largest economy is expected to grow faster than other developed-market countries for the third year in a row. The re-election of US President Donald Trump is predicted to result in higher tariffs on China and on imported cars, much lower immigration, some fresh tax cuts, and regulatory easing.
“The biggest risk is a large across-the-board tariff, which would likely hit growth hard,” Hatzius added.