New York: US-based credit agency Fitch has revised its global GDP growth forecast for 2025, lowering it to 2.3%, which reflects a decrease of 0.3 percentage points.

According to Anadolu Agency, Fitch has attributed this adjustment to the initiation of a global trade war by the new US administration. This trade conflict is expected to dampen both US and global economic growth, increase US inflation, and delay rate cuts by the Federal Reserve.

The revised growth rates are significantly below trend, falling from nearly 3% annual growth projected for 2023 and 2024. Although fiscal easing in China and Germany is anticipated to mitigate the effects of increased US import tariffs, growth within the eurozone is predicted to be substantially weaker than previously forecast in the December Global Economic Output report.

Fitch highlighted that both Mexico and Canada are likely to face technical recessions due to their significant trade exposure to the US.