The International Monetary Fund (IMF) is assessing the impact of the U.S. President Donald Trump’s tariff plans and the 25% auto tariffs he recently announced. However, the global lender’s spokesperson stated that based on their baseline forecasts, there are no signs of recession in the U.S. economy.
In a regular IMF press briefing, Julie Kozack, IMF spokesperson, stated that the US economy continues to outperform expectations since IMF’s World Economic Outlook in January. Even throughout the monetary tightening cycle that ended last year, U.S. economic status remained “remarkably strong.”
Back on January 17, three days before Trump took office, the IMF increased its 2025 U.S. growth forecast from 2.2% to 2.7%, citing a strong labor market and accelerating investment. Kozack stated that many developments have happened since then, whether to be the announcement of shifting in large policy or the signal of a slowdown in economic activity.
However, the spokesperson stated regarding the U.S. that “…… recession is not part of our baseline.”
When asked on the effect of Trump’s tariff on inflation, Kozack did not respond but stated that inflation is more persistent than anticipated, meaning that central bank and policymakers must impose agile and proactive monetary policy to anchor inflation expectations.
Kozack also mentions the status of Russia’s inflation, stating it remains high above the Russian central bank’s 4% target due to tight labor market and strong wage growth. The IMF made a prediction in January that Russia’s inflation would ease, but now, the organization does not see signs of easing at all.
