Kavan Choksi UAE Discusses a Few Global Economy Trends to Watch Out For in 2025

Demographic shifts, potential policy changes from the United States and geopolitics are likely to be the key drivers shaping the global economic and consumer landscape in the year of 2025. As per Kavan Choksi UAE,  economies, businesses and consumers are likely to face both challenges and opportunities in 2025. These challenges and opportunities may arise from increasing trade protectionism and tariff risks, sluggish economic and income growth and more.

Kavan Choksi UAE underlines the trends likely to shape the global economic and consumer landscape in 2025

The global economy is expected to grow at a steady pace by about 3.2% in 2025. This growth is likely to be supported by lower interest rates and easing inflation. Improving financial conditions and declining expenses may provide a level of relief, ultimately boosting consumer spending and investment. Growth, however, may remain sluggish, and fall short of the pre-pandemic 10-year average of 3.7%. There are many factors that continue to weigh on business and consumer sentiment. These factors include lingering uncertainties, economic fragmentation and rising geopolitical risks.

Monetary easing and moderating inflation, in addition to stabilized supply chains, help create a foundation for cautious optimism. Businesses should adapt to a slower growth environment in 2025, and subsequently address increased risks by building operational resilience, exploring untapped markets and focusing on cost efficiency. Leveraging innovative solutions for enhancing productivity would also play a role in managing risks.

The macroeconomic narrative in 2025 and beyond will be significantly influenced by the economic agenda implemented by US President Donald Trump in his second term. Potential tariff, immigration and tax shifts would impact everything from supply chain resilience to consumer spending. The tax cuts proposed by Donald Trump may deliver short-term boosts to consumer income and business investments in the United States. In the middle term, however, the positive impact of tax cuts may also be offset by the negative effect of supply-side constraints resulting from Trump’s other policies. These policies include increased tariffs and immigration controls.

Trump’s proposed tax cuts can deliver short-term boosts to business investment and consumer income in the US. However, in the medium term, the positive effects of tax cuts could also be offset by the negative impacts of supply-side constraints resulting from Trump’s other policies, namely increased tariffs and immigration controls. If Trump follows through on his promises to increase tariffs, it could escalate global trade tensions, prompting retaliation and heightened trade protectionism that may extend beyond just the United States and China.

In the opinion of Kavan Choksi UAE, global businesses may need to navigate quite a complex trade landscape in 2025, while re-shoring and near-shoring are expected to go up as companies experience the need to build resilience and reduce dependence. This can be done by diversifying supply chains and manufacturing bases. For the purpose of navigating the upcoming rapidly changing economic environment, businesses should effectively sharpen their market foresight. They also must adopt robust strategies in order to capitalize on evolving opportunities and manage risks.

Global consumer price growth is expected to ease to 4.2% in 2025. On the other hand, nominal disposable income is anticipated to grow at a slightly higher rate of 4.7%. This may provide some relief following an extended period of rising living expenses.