Why Haven’t Tariffs Trashed the Global Economy? Explaining the ‘Global Resilience Puzzle’
When we start a new year, it’s good to look back and take stock of where we’ve been. The global economy faces significantly higher trade barriers than it did just a year ago. And rather than being consigned to the economic history books, tariffs are now just a part of life. We expected this to weigh on growth and impact inflation. But so far, it hasn’t quite turned out that way. At the start of 2025, we forecast the US economy to grow 2.4 per cent and the global economy to grow 3.2 per cent. But, after tariffs were announced, we revised our forecasts for growth down, to 1.6 per cent and 3 per cent,