Economy 2025: Why Do Experts Anticipate A Global Recovery?

The year 2025 is shaping up under favorable auspices for the global economy, despite ongoing challenges. As fears of recession fade and inflation begins to normalize, several indicators suggest a positive momentum for the months ahead.

A resilient American consumption drives global growth

In New York, economists from Wall Street are watching with satisfaction the remarkable resilience of the American economy. The American consumer, a true engine of the world’s largest economy, continues to demonstrate solid confidence despite the turbulence of recent years.

Retail sales are steadily progressing, supported by a robust labor market where the unemployment rate remains historically low. “The American economy continues its progression at a sustained pace, just as it has for several years“, highlights David Kelly, Chief Strategist at JPMorgan Asset Management.

Real wages are finally increasing more rapidly than inflation, gradually restoring households’ purchasing power. This positive momentum is expected to continue in 2025, providing a solid foundation for global economic growth.

Consumer confidence is also bolstered by the stabilization of energy prices. With American oil production reaching record levels, analysts forecast an average gas price around $3.22 per gallon for 2025, marking the third consecutive year of moderation in pump prices.

A more accommodating economy on the horizon

The U.S. Federal Reserve, after having waged a determined fight against inflation, is embarking on a welcome monetary easing cycle. Three consecutive rate cuts have already been made, signaling a significant shift in monetary policy.

This shift is expected to stimulate business investment and support the real estate market, two sectors that had been hindered by the rapid rise in interest rates. Analysts anticipate further rate cuts in 2025, which could further boost economic activity.

Financial markets have already begun to integrate these more favorable prospects, even as caution remains regarding the valuations of certain sectors, particularly technology.

Promising structural reforms

The implementation of new economic policies suggests potential productivity gains. Initiatives aimed at simplifying regulation and accelerating approval processes could stimulate investment and innovation.

Glenn Hubbard, former dean of the Columbia Business School, is particularly optimistic about modernizing the regulatory framework: “The most significant productivity gains often come from these structural adjustments, even if they appear less spectacular.”

Challenges certainly remain, particularly around trade issues and the balance to be struck between growth and price stability. Nevertheless, the solid economic fundamentals and ongoing political adjustments paint an encouraging outlook for 2025.