Fitch Ratings warns of lower growth, higher inflation, and less Fed rate cuts in 2025

Joshua Gibson FXStreet

The Fitch Ratings agency downgraded its expectations for United States (US) Gross Domestic Product (GDP) growth in 2025 on Thursday, specifically highlighting that the Trump administration's "Liberation Day" tariff announcement poses a direct risk to US economic health.

Key highlights

Liberation Day takes US tariff rates back to a level last seen in 1909.
US growth in 2025 is likely to be slower than the 1.7% that we had projected in March, given higher-than-anticipated tariffs.
Tariff hikes will result in higher consumer prices and lower corporate profits in the US.'
Upward pressure on goods prices from tariffs means the Fed is likely to become more cautious about further rate cuts in the near term.

Author

Joshua Gibson

FXStreet

Joshua joins the FXStreet team as an Economics and Finance double major from Vancouver Island University with twelve years' experience as an independent trader focusing on technical analysis.

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