At a Glance

  • The U.S. economy is likely to grow 2.3% in 2025, partly driven by improved credit conditions, rising stock prices, and an increase in average manufacturing hours, the Conference Board said on Wednesday.
  • "We expect growth momentum to remain strong at the start of the year," said Justyna Zabinska-LaMonica, senior manager of business cycle indicators at the Conference Board, in a statement, noting "fewer headwinds for future U.S. economic activity."
  • But the outlook is not entirely rosy. The institution said its Leading Economic Index edged down 0.1% last month, following a 0.4% rise in November. Weak manufacturing orders, declining building permits, rising unemployment claims, and low consumer confidence all pose risks to growth.

Deep Insights

Several organizations have recently singled out the United States as a particularly promising economy for 2025.

The International Monetary Fund predicted last Friday that U.S. GDP will grow 2.7% this year, only a slight slowdown from its estimated 2.8% growth in 2024.

"Underlying demand remains strong, reflecting a robust wealth effect, a less restrictive monetary policy stance, and supportive financial conditions," the IMF said in a report, noting it had raised its 2025 U.S. growth forecast by 0.5 percentage points compared to its October projection.

The upward revision partly reflects "carryover effects from 2024, as well as other signs of strength such as a robust labor market and accelerating investment," the IMF said.

The World Economic Forum also described an optimistic outlook for the U.S. economy in a report on chief economists' expectations released Thursday.

"The U.S. economy is expected to see strong growth in 2025," the forum said.

Nearly half of surveyed economists (47%) expect President Donald Trump's policies to boost short-term growth, the forum said. However, that share falls to 27% in the medium term and 18% in the long term.

Chief economists expect Trump to drive major changes in trade, immigration, deregulation, fiscal policy, industrial policy, and foreign policy. "The only policy area where respondents do not expect significant changes is monetary policy," the report said.

According to the forum, chief economists believe Trump is most likely to bring the biggest changes to U.S. trade, immigration, and foreign relations policies. 94% of chief economists expect inflation to accelerate under Trump.

"Key factors likely to push prices higher include the stimulative effect of tax cuts (expected by 91% of chief economists), and the impact of labor supply shocks on wages and prices if mass deportation plans are implemented to their fullest extent," the forum said. Higher tariffs would also add to price pressures.

From a global perspective, the start of Trump's second term should be seen as "an inflection point in the political and economic order, consolidating trends that have been building in many countries since the 2007-2009 global financial crisis," the forum said.

"The global economic outlook remains subdued, with downside risks heightened, especially due to increased uncertainty surrounding the economic impact of the November U.S. presidential election," the forum said.