Experts Predict US Recession in 2025 if Trump-China Trade War Tariffs Stay

The ongoing Trump-China trade war has the netizens in complete turmoil, as the US Recession odds rise in 2025. Although there have been concerns around this topic, the Chief Economist at Apollo Global Management has fueled the fear. Recently, he claimed that an economic slump is to hit America in 2025 amid the tariff situation. Let’s discuss what he has to say.

Apollo Claims US Recession is Absolute in Summer 2025

In a recent CNBC’s Squawk on the Street interview, Apollo Economist, Torsten Slok, has claimed that the US Recession could absolutely form in 2025, if the tariff conditions remain the same.

“It’s all conditioned on tariffs staying in place at these levels, and if they stay at these levels, we will absolutely have a recession in 2025,” Slok.

The US government under Trump’s leadership has ignited a trade war, especially with China, placing a 145% tariff on imported goods from there. Although Trump granted a 90-day pause on reciprocal tariffs, the failure of new updates on the situation increases the odds of further turmoil.

Slok has pointed out the same, claiming that if the Trump-Chain trade war stays put, the gross domestic product (GDP) could drop by 4%. More importantly, he predicted a 90% probability of a two-quarter economic contraction. An Apollo report clearly mentioned their prediction of a US recession in the Summer of 2025.

Experts have been calling for the Fed to cut the interest rate to reduce the impact. Even Donald Trump criticised Jerome Powell for the delay, but there’s still no update. Amid this, the odds of unchanged rate cuts and economic slump are increasing.

US Recession News: Business and Supply Chain at Risk Amid Trump-China Trade War

The US recession odds have increased significantly due to the US-China trade war. The Polymarket report shows 56% probability, and it was 66% at the beginning of the month. Even JP Morgan has increased recession odds to 60%, and the same is true for other analytics firms.

The impact of this tariff influenced the stock, bonds, gold, and even crypto market performance. However, now the impact is also visible in the supply chain.

Bloomberg reported that the cargo shipments have decreased by 60%. Although they noted that America has not felt the impact yet, Giant retailers (Walmart, Target) predict COVID-like shortages, layoffs, and a severe impact on the retail industry.

The Apollo economist has revealed similar insights, claiming that smaller businesses are more vulnerable and are more likely to experience bankruptcies and layoffs. The upcoming Jobless claims could bring a better picture of the labor market, witnessing the Trump tariff effect.