Trump’s duties bring the world economy to the weakest growth that has been seen from Covidgiving a particularly strong blow to the prospects of the USA, and impacting China and Europe: The Italian GDP, as in FMI and Bankitalia estimates, would stop this year at +0.6%, the US one would be halved in its growth at 1.6%. It is the OECD to deal after the ‘Liberation Day’ with which Trump – was April 2 – had enumerated the list of duties for each country. In the meantime, the negotiations, retaliation and the gears behind, even if the agreement with China shakes between mutual accusations and the EU, to date subject to duties of 10%, would go to the next month, it would go to 50% without an agreement. A climate of uncertainty that weakens the global economy “practically without exception”, warns the Parisian organization. Included Italy, where the PNRR would help investments and the recovery of wages will help consumption.
But on the 0.6% “risks are down oriented” due to the factor-tooth. The crisis of industry weighs, and exports in volume “is intended for stagnation in 2025” in front of the duties and a weak question also in Europe. The Meloni government, with the spread under 97, collects Goldman’s promotion today which sees three reasons “to be constructive on the Italian debt in 2025″: the European aid of the PNRR support the public coffers, the real rates remain ” Pre-Pandemica “and the Meloni government” is the only one “of the” last 20 years to have earned in popularity in the 30 months following its settlement “.
Global growth, in the OECD numbers, stops at 2.9% in 2025 and 2026 after exceeding 3% during each year after 2020. The USA pull the handbrake, almost halving growth from 2.8% of last year to just 1.6% in 2025: with the aggravating circumstance that the exacerbated inflation from the overctress on the import would prevent the Fed from cutting the rates. China still struggling with the real estate crisis and with the US commercial policies would brake from 5% to 4.7% and then to 4.3% in 2026. The Eurozone would mark an acceleration from 0.8% to 1% this year, driven by the estate of economies such as Spain (2.4%). But for the twenty Economies of the euro it is still a worsening compared to 1.3% estimated last December, before the duties: they weigh Germany, which from -0.2% in 2024 would accelerate to +0.4%, but less than +0.9% indicated a few months ago; of Italy, which from 0.7% of 2024 slows down 0.6% instead of accelerating 0.9% as the OECD thought in December, which was then lined to 0.7% in March; and finally of France, which from 1.1% in 2024 drops to 0.6%.
It is the effect of the “consisting barriers to trade, more restrictive financial conditions, less trust and high uncertainty”, says the OECD: largely a mix created by the new US administration. The imperative is concluding agreements to lower the duties, and quickly: “Otherwise – warn the chief economist of the OECD Alvaro Pereira – the impact on growth will be rather significant”. If the Fed options are limited by inflation, for the ECB the inflation today braking at 1.9% for the month of May by 2.2% in April opens the door to an eighth cut of the rates already to the Board of Directors this Thursday: it would drop to 2% and the OECD recognizes that “the cost of money is expected in additional descent, up to 1.75% in the second part of the year”. From then on, it is dark pesto on what the ECB will do: it will largely depend on the Brussels negotiation with Trump, even if for now the duties – according to Frankfurt – strengthening the euro are having more impact on the growth on the growth on inflation. The scenario, however, deals with “substantial” risks: a further tariff escalation or the possibility of sudden decisions on the duties; a more prudent attitude of companies and consumers; and the persistence of a re-compliance of the risks on the financial markets “, nod implicit to the unusual weakness of the dollar associated with strong rise in the US debt US Federal Budget.