The Indian economy is set to face challenges in 2025, with the International Monetary Fund (IMF) forecasting a slightly weaker performance despite steady global growth. IMF Managing Director Kristalina Georgieva, in her annual media roundtable, highlighted the uncertainty that could arise from shifts in U.S. trade policy, which may further impact the global economic landscape. While global growth is anticipated to remain stable.
Disparities in Global Economies
Georgieva pointed out that regional disparities will likely persist, with some economies experiencing stronger growth than others.
Georgieva also highlighted economic challenges in other major economies, with Brazil facing higher inflation and China grappling with deflationary pressures and weak domestic demand. She emphasized the vulnerability of low-income countries, which could suffer significantly from any new global shocks.
Uncertainty in the U.S. Economic Policies
The IMF chief warned that 2025 would likely be marked by considerable uncertainty, particularly concerning the U.S.’s future economic policies under its incoming administration.
She pointed to potential shifts in trade policy, tariffs, taxes, deregulation, and government efficiency as critical factors that could influence global markets. This uncertainty, according to Georgieva, is contributing to higher long-term interest rates globally, even as short-term rates have fallen.
With Donald Trump set to be inaugurated as the 47th President of the United States on January 20, the direction of U.S. economic policy remains a focal point for international markets.
(With PTI Inputs)