The global economy will continue to grow in the second half of 2025, but at a slower pace, according to ING Belgium’s latest outlook. The slowdown is mainly driven by the trade war launched by US president Donald Trump and ongoing geopolitical tensions.
ING chief economist Peter Vanden Houte estimates that final US import tariffs on EU goods will likely come in just below 15 per cent. This could reduce EU economic growth by 0.14 to 0.33 percentage points, and Belgian growth by 0.11 to 0.26 points.
The trade conflict is also beginning to affect the US economy. While it is still unclear whether this will result in a recession, inflation is expected to rise temporarily to around 4 per cent.
In Europe, first-quarter growth was artificially boosted as US companies stockpiled goods ahead of tariffs. Figures were also skewed by Ireland, where many US multinationals hold patents. ING expects a correction over the summer, possibly with negative growth, but forecasts overall annual growth of around 1 per cent and inflation near 2 per cent.
Belgium also recorded strong early-year figures, but much of that growth was driven by public spending. “As a result, Belgian growth will be below the eurozone average both this year and next”, said Vanden Houte.
ING expects the US federal reserve to cut interest rates towards the end of the year. The European Central Bank is likely to lower rates once more in September before holding them steady at 1.75 per cent.
