Summary The U.S. economy rolled into 2025 after four years of solid economic growth. Although all was not perfect, the momentum bode well for another year of solid economic growth in 2025 unless an economic shock occurred. It did, in the form of tariffs. 2025 became the year of the tariff. The United States implemented an aggressive tariff policy in an attempt to reshape global trade and manufacturing. The tariff rates were largely based on the U.S. trade deficit with a given country rather than the tariff rate charged by the foreign country on U.S. goods. The U.S. tariffs resulted in significant pushback from trading partners through reciprocal tariffs and reduced investment in the United States. The resolution of the tariff wars will likely be the driving force affecting the U.S. economy in 2025, and perhaps beyond. Much remains to be determined with the continuing saga of tariffs. The ultimate resolution of tariff rates and tariff wars on economic growth, inflation, employment, and financial markets remains to be seen. However, there is no doubt that the tariff wars will reshape perceptions of the United States as a trading partner and its role in economic leadership.
Central Wisconsin Report - Spring 2025
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