Conflicting forces

This NatWest Economic Update examines the conflicting forces shaping global economies as we enter 2025, focusing on inflation, labor markets, and policy shifts.

• UK Economy: Gradual recovery expected, with 1.4% growth in 2025, but sticky inflation and higher taxes challenge consumer spending and business investment.  
• U.S. Trends: Resilient GDP growth at 3% driven by consumer strength, though higher rates and tariffs may dampen rate-sensitive sectors.  
• Eurozone Challenges: Weak growth and structural issues persist, with Germany particularly exposed to U.S. tariffs on key exports.  
• China’s Struggles: Policy measures aim to counter deflation and housing market declines, with GDP growth forecasted at 4.5%.  

For a comprehensive analysis, access the full report.