Fitch Ratings said on Tuesday that the global trade war, started by the Trump administration, will reduce growth in the United States and internationally, as well as increase domestic inflation and delay Federal Reserve rate cuts. The ratings agency revised US growth for 2025 down to 1.7% from 2.1% in the December report, while 2026 growth was cut to 1.5% from 1.7%. World economic growth is seen at 2.3% this year and 2.2% in 2026.
Fitch also warned the Eurozone's economy will experience significantly weaker growth than the 1.2% predicted in December. While it expects that fiscal easing in China and Germany will help carry the burden of US tariffs, Mexico and Canada are forecast to experience technical recessions "given their high US trade exposure."
