JPMorgan Warns Trump’s Tariffs Could Lead U.S. to Recession in 2025
JPMorgan Chase has issued a stark warning that former President Donald Trump's proposed tariffs could plunge the United States into a recession as early as 2025. The bank's economists predict that Trump's plan to impose reciprocal tariffs on countries that tax U.S. exports could disrupt global trade significantly, leading to higher prices and reduced economic activity domestically.
Analysts at Hindustan Times suggest that a recession triggered by these tariffs could have direct impacts on American consumers, particularly at grocery stores where prices may surge due to increased costs of imported goods. This could lead to stagflation, a scenario where slow economic growth coincides with rising prices, further complicating recovery efforts.
PBS's economic analysts have answered four critical questions about the potential rise in prices due to Trump's tariffs, emphasizing the need for consumers to prepare for potential economic shifts. CBS News also reports that a broad consensus among economists points to a heightened risk of recession, with concerns about the broader implications for the U.S. economy.
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How are tariffs imposed?
Tariffs on imports are designed to raise the price of imported goods and services to discourage consumption. The intention is for citizens to buy local products instead, thereby stimulating their country's economy. Tariffs therefore provide an incentive to develop production and replace imports with domestic products.
How is the US economy?
Economic growth The economy recorded average annual growth of 2.5% in the decade to 2024. However, growth was disrupted by the COVID-19 pandemic in 2020, leading to a sharp but brief recession. The subsequent recovery in 2021-2023 was rapid, fueled by strong growth in consumption and exports.
Is the US in a trade war?
An economic conflict between China and the United States has been ongoing since January 2018, when U.S. president Donald Trump began setting tariffs and other trade barriers on China with the goal of forcing it to make changes to what the U.S. says are longstanding unfair trade practices and intellectual property theft ...
What causes a recession?
Recessions can be the result of a decline in external demand, especially in countries with strong export sectors. Adverse effects of recessions in large countries—such as Germany, Japan, and the United States—are rapidly felt by their regional trading partners, especially during globally synchronized recessions.
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