emerging
US Soft Landing Expected
The US economy is expected to achieve a soft landing in 2025, with moderate growth and decreasing inflation, despite potential risks.
Timeframe
near-term
Categories
Subcategories
Impact areas
Detailed Analysis
The document anticipates a soft landing for the US economy, characterized by continued growth around 2% and easing inflation. This projection is based on factors like sustained job creation and rising corporate profits, which support household spending and business investment. "Data is consistent with our moderate growth scenario as of now. In the US, momentum has clearly slowed in the labour market in the past couple of quarters, but businesses continue to add new hires every month, supporting household spending."
Context Signals
Fed rate cuts are expected
Corporate profits are rising
Labor market momentum has slowed but remains positive
Edge
This soft landing could create a favorable environment for risky assets, particularly US equities, despite current high valuations.
The potential for re-accelerating inflation or a recession remains a risk, requiring active portfolio management.
The impact of the incoming Trump administration's policies, particularly fiscal spending and tariffs, could significantly influence the trajectory of this soft landing.
