USA Today (August 16)
“President Donald Trump’s aggressive economic policies will likely significantly slow U.S. growth and push up inflation but stop short of causing a recession or “stagflation” – the dire scenarios that forecasters envisioned before he took office.” Economist Justin Begley of Moody’s Analytics believes the U.S. is edging toward stagflation, but will not end up there. Much will depend on the Fed which “faces a dilemma because lowering rates to bolster a softening labor market could further drive up inflation.”
Tags: Begley, Dilemma, Economic policies, Economist, Fed, Growth, Inflation, Labor market, Moody’s Analytics, Rates, Recession, Stagflation, Stagflation. Dire, Trump, U.S.
Financial Times (July 28)
“The world was in striking agreement on one point: if Donald Trump went ahead with tariffs, it would strengthen the dollar and trigger stagflation.” It hasn’t, even though the “effective US tariff rate has already risen from 2.5 per cent to 15 per cent.” This outcome is unlikely to upturn conventional tariff wisdom. The U.S. is not “really enjoying a free lunch, taking in $300bn a year in tariff revenues with none of the expected heartburn.” It is much more probable that other factors, like AI’s explosive growth, have hidden the impact. The most likely culprit is “the timeworn mistake of employing simple models…. Complex economies are rarely shaped by just one factor, not even a shock as big as Trump’s tariffs.”
Tags: 15%, Agreement, AI, Complex economies, Conventional wisdom, Dollar, Free lunch, Hidden, Impact, Simple models, Stagflation, Tariffs, Trump, U.S.
Financial Times (March 14)
“It now appears that neither a slowing economy nor plunging stock prices are enough to deter US President Donald Trump from his radical economic agenda.” His “hotchpotch of economic measures” have already “raised the spectre of stagflation, wiped $5tn off the S&P 500, and undermined the nation’s standing with global investors.” If there was an “intelligible” strategy, “the short-term pain might be easier to digest,” but so far his actions lack “any coherent theory of change.”
Tags: $5tn, Deter, Global investors, Hotchpotch, Intelligible, Plunging stock prices, Radical economic agenda, S&P 500, Slowing Economy, Stagflation, Trump, Undermined, US
Financial Times (February 7)
The Bank of England (BoE) “has halved its 2025 growth estimate and cut interest rates… as it contends with a stagnant UK economy and an increasingly uncertain international environment.” In November, the BoE expected annual economic growth of 1.5%. Now it expects growth of just 0.75%, with higher unemployment and rising inflation. The new forecasts “will stoke fears of stagflation” and the Monetary Policy Committee voted unanimously to cut benchmark rates from 4.75% to 4.5%.
Tags: 2025, Benchmark, BOE, Economic growth, Environment, Forecasts, Halved, Inflation, Interest rates, MPC, Stagflation, Stagnant, UK, Uncertain, Unemployment
Washington Post (July 20)
We may be living in a “Goldilocks economy,” but it “has an end date.” Last year, the investors who “thought stagflation was here to stay were wrong, and they’ll be wrong again if they count on Goldilocks sticking around. Growth and inflation will line up sooner or later, and it’s the growth data that provides a better signal for the trajectory of the economy.”
Tags: End date, Goldilocks economy, Growth, Inflation, Investors, Last year, Signal, Stagflation, Trajectory, Wrong
New York Times (May 21)
“The euro hasn’t fallen below the one-to-one exchange rate with the U.S. dollar for two decades. But as economic risks grow, more analysts predict deeper lows for the shared currency.” The U.S. currency is considered one of the safest havens “for money as the risk of stagflation — an unhealthy mix of stagnant economic growth and rapid inflation — stalks the globe.”
Tags: Analysts, Currency, Dollar, Economic risks, euro, Exchange rate, Growth, Havens, Money, Stagflation, Stagnant, U.S., Unhealthy
Euromoney (March 24)
“The UK economy seems at last to be suffering from the erosion of purchasing power by sterling-induced inflation. All of this smacks of stagflation, a constitutional crisis and rising political risk. UK gilts will suffer.”
Tags: Constitutional crisis, Economy, Erosion, Gilts, Inflation, Political risk, Purchasing power, Stagflation, Sterling, Suffering, U.K.
