JP Morgan estimated that the United States would slip into the recession by the end of 2025, which blames the large -scale fall for President Donald Trump’s newly declared mutual tariffs. Following the forecast, Trump implemented extensive duties on imports in a bid to unbalance the trade relations, which led to further increase in major trade deficit countries with the US including India.
In a note released on Friday, JP Morgan’s chief American economist Michael Feroli wrote that America’s GDP is likely to shrink “under the weight of tariffs”. He further warned that the resulting economic slowdown is “expected to increase the unemployment rate to 5.3” [percent]”According to the hill.
Concerns were echoed by the US Federal Reserve President Geom Powell, who said that tariffs could give a heavy blow to the economy than already estimated. Speaking at a professional journalism conference on Friday, Powell said, “While uncertainty remains high, it is now clear that the tariff growth will be much larger than expected. There is a possibility of economic effects to come true, which will include high inflation and slow growth.”
Under the new policy, 10% tariff is applied to all imports starting from April 5. From 9 April, countries with the largest American trade deficit – India -India – will face high, customized levy. India will see 26% tariffs on all its exports.
Despite this rapid growth, brokerage firm Jefferies said the impact on India’s outbound trade could be limited. In a client note, the firm reported that the major Indian export sector – such as IT services, pharmaceuticals and automobiles – have not collided directly with tariff escalations.
“27 percent (now corrected up to 26 percent in a document) Tariff on India seems appropriate from a relative point of view. Large concerns are on weak US economic approach, which is a -VE for IT services and other exporters,” Jefferies said. While the firm played direct tariff results, it warned that a broad American recession could weigh, especially in technology services, on demand for Indian exports.
The Global Economic Outlook now faces further pressure because the growing American trade inspires the cascading effects of the war.
