Fitch warns global economy to slow significantly despite marginal upward revision

Forecasts growth to be 2.4% in 2025, up 0.2pp since June US tariff hikes huge and will reduce global growth 'Hard data' showing US slowdown; no longer just in sentiment surveys China's export growth holding up, but domestic demand weakening, and deflation entrenched Eurozone consumer recovery fading

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FITCH Ratings said yesterday that it expects world GDP to slow significantly this year.

The agency has raised its world growth forecasts for 2025 moderately since the June Global Economic Outlook (GEO) on better-than-expected incoming data for 2025.

But there is now evidence of an underlying US slowdown in 'hard' economic data and positive surprises on Eurozone growth have partly reflected US tariff front-running.

The ratings agency said global growth is now forecast to be 2.4% in 2025, up 0.2 percentage points (pp) since June but a sizeable slowdown from 2.9% last year and below trend. China's forecast has been raised to 4.7% from 4.2%, the Eurozone's to 1.1% from 0.8% and the US's to 1.6% from 1.5%.

World growth for 2026 is 0.1pp higher at 2.3%.

"There has been a reduction in uncertainty over US tariff policy after a flurry of announcements," Fitch said.