Most years fade into the background as soon as a new one starts. Not 2025: a year of epochal shifts, in which the macroeconomy was the dog that did not bark. What to expect in 2026? The shocks of 2025 will not be undone, but neither will they be repeated. Instead, their effects will work their way through the system, in ways that are unlikely to be linear and smooth. In the baseline scenario, the macroeconomy will remain a dog that does not bark, either out of alarm or joy. However, there are a few potential path changers to look out for. Chances are, then, that 2026 will not feel any smoother on a day-to-day basis than its predecessor. However, that will not mean good outcomes cannot be reached for those who keep their heads.
With the energy transition in full swing, the European electric vehicle market is at a turning point. After a promising start, it is time to shift into high gear to meet the European Union's climate ambitions. But this acceleration will not be without challenges.
A look back at the key developments of 2025, in particular the remarkable resilience shown by the global economy in the face of the US tariff shock, the reasons for this resilience, but also the areas of concern.
Fireside chat between Jean Lemierre (Chairman of the Board of Directors of BNP Paribas) & Isabelle Mateos y Lago (Group Chief Economist).
In today’s discussion, we delve into the public finances of emerging economies in 2025, based on an exclusive analysis of our most recent EcoPerspectives issue focused on these economies. With robust but slowing growth, rising public debt and limited fiscal flexibility, what challenges and opportunities lie ahead for these countries?
The latest economic news.
Since Donald Trump's return to the White House in 2025, the United States has massively increased its tariffs. As a result, trade flows to the US have been disrupted, but has this affected the dynamics of global trade? And above all, are we heading towards a major restructuring of global trade?
Exports from Central European countries (Hungary, Poland, Czech Republic, Romania, Slovakia) have shown great resilience since the beginning of the year despite the US tariff shock. The automotive sector, a major pillar of the region's economies (both for industry and exports)[1] , has also fared well overall, while exports from the sector contracted in Western European countries in the first seven months of 2025 compared to the same period in 2024.
The Mexican government has announced plans to increase customs tariffs. Asian countries in general, and China in particular, are being targeted. The measure is expected to be adopted by Parliament in November before being implemented next January for a period of one year.
The Treasury market is one of the pillars of the global financial system. This is due to its size and liquidity, its role in setting borrowing conditions, and the safety that these securities provide.However, the announcement of so-called 'reciprocal' tariffs last April caused turmoil in the market, reminding us that Treasuries had become more sensitive to periods of stress…
Since the beginning of the year, the resumption of the trade war between the United States and China has led the latter to redirect its exports in record time. On average over April to July, while Chinese exports to the US contracted by 23% year-on-year (yoy) in value terms, those to Africa increased by 34%, far more than those to ASEAN countries (17%) and Europe (7%).
Since the cessation of most Russian gas supplies, reducing Europe's energy vulnerability, and thus improving its economic security, has been a key issue for European decision-makers. However, recent pressure from the United States on Europe to increase its purchases of US hydrocarbons could raise fears of a new significant dependence on US liquefied natural gas (LNG)..
At a time when central banks are navigating between persistent inflation, economic slowdown, and unprecedented structural challenges, their room for maneuver has never been so closely scrutinized. Should they lower rates to support growth, maintain them to anchor inflation, or raise them in the face of unexpected shocks? Between balancing acts, threats to their independence, and regional divergences, the choices made by central bankers will shape the economy of tomorrow.
What are the common challenges and differences between the Fed, the ECB, the Bank of England, and the Bank of Japan? How are AI, climate change, and geopolitical tensions reshuffling the deck?
Why might the Fed cut rates despite stubborn inflation? What card will the ECB play in the face of a fragile European recovery?
Monetary easing in Asia and Latin America, but vigilance in Brazil and Central Europe: what risks weigh on their growth?
After the major upheaval of ‘Liberation Day’, the dust has settled somewhat. The level and scope of the new US tariffs are now largely known, and advanced economies are continuing to show resilience. Despite significant fluctuations in trade in the first half of the year, global trade has been braodly unaffected so far. The combination of headwinds (US tariffs, uncertainty) and tailwinds (low oil prices, Fed rate cuts, European measures) explains the gradual nature of the slowdown (in the US) and the recovery (in the Eurozone). The Eurozone is doing relatively well: with growth expected to strengthen and inflation under control, it is escaping the stagflationary scenario seen in the US, the UK and Japan.
The French economy is entering a new budgetary cycle that is likely to be as complicated as the previous one. However, the economy appears to be more robust than in 2024. Firstly, the productive sector is in better shape today in several key areas (notably aeronautics and agriculture), which is reflected in the growth figures. Secondly, the shadow of political uncertainty has not undermined the strengths of the French economy: business creation, the labour market, a balanced current account, the transmission of ECB rate cuts to the private sector and the improvement in private investment
What is the impact of the new US tariffs on the customs duties imposed on each country's exports as a whole? Estimates of the "average effective external tariff" show that the shock remains relatively limited for the European Union and the United Kingdom. The framework agreement signed on 27 July between the EU and the US imposes a uniform tariff of 15%, incorporating pre-existing tariffs, and includes a most-favoured-nation (MFN) clause for certain strategic sectors (aeronautics, certain pharmaceutical and chemical products).
Economic growth in emerging countries held up well in the first half of 2025. So far, US tariff measures have had little impact on global trade and therefore on their exports. Furthermore, domestic demand, another driver of growth in these countries, remains strong, in particular thanks to the support of domestic credit. Bank lending growth has returned to its pre-COVID level for a large number of countries, it exceeds potential GDP growth in real terms. This is a trend to watch, as it could lead to a deterioration in foreign trade and/or an increase in non-performing loans.
Since the beginning of the year, China’s economic growth has proved to be more robust than expected. Exports have withstood US tariff attacks and household consumption has recovered thanks to government stimulus programs. However, large clouds are casting a shadow over the picture and are likely to slow growth in the second half of the year. On the one hand, trade tensions with the United States remain high and the tech war continues, even though Beijing and Washington have agreed to extend their truce until November. On the other hand, internal structural problems remain (real estate crisis, labour market fragility, low confidence in the private sector, deflation). Despite this gloomy backdrop, economic policy easing remains cautious
Broadly speaking, the economic outlook for the global economy at the beginning of September remains largely unchanged from that at the end of July: namely, an economy that, overall, continues to withstand the double blow of US tariffs and uncertainty. Our current scenario expects an average annual growth of 1.6% in the United States in 2025, followed by 1.5% in 2026 and 1.3% in the Eurozone for both years (after 2.8% and 0.8% respectively in 2024). So, while the pace of US growth is expected to remain higher than that of the Eurozone, the outlook is for a slowdown across the Atlantic. On the Eurozone side, however, signs of recovery, albeit tentative, tend to predominate, to the point where the Fed is ready to resume its rate cuts and the ECB is ready to halt them
On August 1, the United States published an updated list of its “reciprocal” tariffs. While this new version provides some clarity, it does not offer a long-lasting explanation of the Trump administration's protectionist policy. In the short term, it changes the game for certain countries, particularly India and China.
GDP growth figures for the first half of the year were clouded by a series of conflicting factors. In Q2, growth in the Eurozone was hit by a decline in exports, while imports in the United States led to a sharp rebound. This is a backlash from Q1, when additional exports, in anticipation of the tariff shock, had supported growth in the Eurozone, while penalising growth in the United States. Beyond this unusual volatility, it is the robustness of growth that is striking. In the Eurozone, German growth was back, although moderately, and monetary policy easing had an impact, with this robustness set to continue in the second half of the year. In the United States, the slowdown remained relative but is likely to strengthen due to the growing impact of tariffs on inflation and consumption.
