Key Facts
• June 25, 2025: JP Morgan analysts warn of US economic slowdown.
• US GDP growth forecast lowered to 1.3% from 2% earlier this year.
• 40% chance of US recession in the second half of 2025.
• Tariff hikes cited as causing ‘stagflationary shock’ to the economy.
• Global economic growth expected to decelerate due to US trade policies.
• Inflation resurgence predicted alongside economic slowdown.
• Analysts maintain a bearish outlook on the US dollar.
• Despite uncertainties, US consumer and economic resilience remain strong.
• Positive outlook for US stocks, especially tech and AI-related sectors.
Summary
JP Morgan analysts have projected a significant slowdown in the US economy, attributing it to the impact of tariff hikes. The GDP growth forecast for 2025 has been revised down to 1.3% from the earlier 2%, with a 40% likelihood of a recession in the latter half of the year. The analysts describe the situation as a ‘stagflationary shock,’ combining slowing growth with rising inflation. While the global economy is also expected to decelerate due to US trade policies, the US dollar faces a bearish outlook. However, resilience in consumer spending and the broader economy provides some optimism. Analysts remain bullish on US stocks, particularly in the technology and AI sectors, which are expected to support market performance.
