U.S. economy steady as Trump takes hold

It The US economy entered 2025 with a steady hand, according to the National Association for Business Economics, the nation’s leading economists group, the likelihood of a long-slow recession.

“The likelihood of a recession continues to decline, with downside risks largely related to uncertainty over the implementation of the new administration’s policy proposals,” said NABE President Emily Kolinsky Morris, CBE, global chief economist, Ford Motor Company, in the January business report in a survey of conditions conducted from December 30, 2024 to January 13, 2025.

President Donald Trump, who took office a week agohit the ground running with a series of executive orders related to making the US more open to cryptocurrencies, easing energy restrictions and hiring freezes for federal workers as its DOGE, the Department of Government Efficiency, assesses areas to cut waste.

In addition, he declared A $500 billion investment from OpenAI, Softbank and Oracle expand artificial intelligence in the US He also threatens to impose tariffs against Canada, Mexico and China.

However, inflation remains a headwind: while 65% of NABE economists see prices holding steady over the next three months, 35% expect prices to rise, up from 28% in October.

The consumer price index rose 2.9% year-on-year last month and 0.4% from November.The core CPI, which excludes volatile food and energy, rose 3.2% year-on-year. Inflation is well below the 9.1% recorded in July 2022, but still above the Federal Reserve’s preferred 2% target.

INFLATION GROWS BY 2.9% IN DECEMBER, IN ACCORDANCE WITH EXPECTATIONS.

President Donald Trump speaks via video conference during the World Economic Forum in Davos, Switzerland, on January 23, 2025. (Halil Sagirkaya/Anadolu via)

TRUMP EXPLODES BOFA, REBANKS AN AGAINST BANK CONTROVERSY.

Trump, in an offhand speech before the World Economic Forum marking his return to office, blamed the Biden administration for high inflation.

“Over the past four years, our government has racked up $8 trillion in pointless spending deficits and inflicted energy-saving restrictions, crippling regulations and hidden taxes on the country like never before. The result is the worst inflationary crisis in modern history, and unprecedented interest rates, food prices for our citizens and even the world and the price of almost everything known to mankind has gone up,” Trump told attendees in Davos, Switzerland He also hit out Fed President Jerome Powell.

“I will demand that interest rates go down immediately. And similarly, they should be poured all over the world. Interests should follow us,” he said.

Fed Chairman Jerome Powell speaks during a Federal Reserve press conference on December 18, 2024 in Washington, DC. (Alex Wong/Getty Images)

Policymakers are expected to leave interest rates unchanged at the end of a two-day meeting on Wednesday, according to The CME’s FedWatch toolwhich tracks the probability of a rate move.That would keep the Fed funds rate in the 4.25%-4.50% range.

CREATE A FOX BUSINESS WITH A QUICK CLICK HERE!

On Thursday, fourth-quarter GDP rose 3%, in line with the 3.1% reported in the third quarter.