Chief Economists Outlook January 2025

14Chief Economists Outlook 25 The American Presidency Project. (2024). 26 Klein, E. (2024). 27 United States Federal Reserve. (2024). US election impact on the global economy 39 61Share of respondents (%)No significant change Short-term disruption Long-term shiftThis edition of the Chief Economists Outlook launches as a new US administration takes office. The systemic importance of the US to the global economy means that changes of administration are always closely assessed for their potential domestic and international implications. However, this pattern has been unusually intense since November’s election, both because of already-fraught global conditions and the platform of dramatic policy change on which the President campaigned.25 Among the chief economists surveyed, there is unanimity that developments in the US will alter the trajectory of the global economy, with a solid majority of 61% characterizing this change as a long-term shift rather than a short-term disruption (see Figure 6). This echoes the view that whereas the first Trump administration could be seen by some as a blip, the second should be seen more as an inflection point for the political and economic order, consolidating trends that have been gathering momentum in many countries since the global financial crisis.26 The chief economists’ expectations for policy change in the US are broadly in line with the policy priorities articulated during the election campaign, with large majorities expecting significant change in the areas of trade, migration, deregulation, fiscal policy, industrial policy and foreign policy. The only policy area in which respondents do not expect significant change is monetary policy, where the Federal Reserve is legally independent of both the presidency and Congress. However, monetary policy may have a significant role to play in cushioning developments in the real economy if changes in other policy areas prove to be inflationary.27 Figure 6. Global impact How would you characterise the likely impact of the US election result on the trajectory of the global economy?2. All eyes on the US Source: Chief Economists Survey. (2024, November).