US Trade Decline Predicted Amidst Tariff Warnings
The WTO reports a drop in global trade due to new US tariffs, prompting fears of inflation and slowing economic growth.
The concerning economic outcome that Mr. Powell warned of — waning growth and rising prices — is known as stagflation, and hasn’t played out in America for nearly half a century.
Stocks Tumble as Fed Chairman Warns of ‘Challenging Scenario’ Resulting From Trump Tariffs
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Even so, Powell said the Federal Reserve can stay patient and wait to see how tariffs and other economic policies of the Trump administration play out before making any changes to interest rates.
Fed's Powell says tariffs could lead to inflation, economic slowdown
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While the Fed remains cautious amid these developments, the effectiveness of the tariffs in boosting manufacturing and jobs is still a matter of debate.
Tariffs will hit US economy and raise prices - Federal Reserve Chair Jerome Powell
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Powell noted Wednesday that is not the case.
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The recent tariff disturbances follow a strong year for world trade in 2024, during which merchandise trade grew 2.9% and commercial services trade expanded by 6.8%, the WTO said.
Global trade outlook has ‘deteriorated sharply’ amid Trump tariff uncertainty, WTO warns
NBC News·3d·ReliableThis source consistently reports facts with minimal bias, demonstrating high-quality journalism and accuracy.CenterThis outlet is balanced or reflects centrist views.The decline in trade will be particularly steep in North America even without the stiffest tariffs, the global trade forum said Wednesday, with exports there this year expected to fall by 12.6% and imports by 9.6%.
World Trade Organization says global trade could slide this year because of Trump's tariff policies
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The outlook for global trade has deteriorated sharply due to a surge in tariffs and trade policy uncertainty.
Trump tariffs will send global trade into reverse this year, warns WTO
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Summary
The World Trade Organization (WTO) has reported a projected 0.2% decline in global trade for 2025, mainly attributed to the tariff policies implemented by U.S. President Donald Trump. North America is expected to experience the steepest decline in exports, forecasted to drop by 12.6%. Fed Chair Jerome Powell has warned that Trump's new tariffs, which include a 10% tax on most imports and 145% on Chinese goods, could lead to rising prices and slower economic growth, with a potential increase in unemployment. Some sectors in Asia and Europe may still see growth despite the downturn.
Perspectives
The WTO predicts a 0.2% decline in global trade this year due to the tariffs imposed by the Trump administration, which has destabilized international trade dynamics.
The projected sharp decline in North American trade reflects broader uncertainty in the global market, exacerbated by reciprocity tariffs and ongoing U.S.-China tensions.
There is hope that services trade may continue to grow despite the decline in goods trade, indicating some resilience in the global economy.
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