BBVA2025年中文经济发展展望

ChinaEconomicOutlook Global Economic Outlook Main messages Economic uncertainty Risks Inflation and ratesoutlook Growth outlook US tariffs have risensharply.Although levies onChina are now around 30%,lower than the expected 60%andwell belowthepost-“Liberation Day” peak of145%,they remain high andthe uncertainty about wherethey will eventually settle is apersistent source of risk. Inthiscontext, andgivenprospectsoflargefiscaldeficits, the US premium riskhasrisen.Growth remainsresilient and inflation haseased,despite early signs oftariff-related deterioration. Lingeringpolicyuncertainty andrising US riskpremium areimportantsources ofconcern.Tariffriskshaveaugmented,butnow appear morebalanced. Protectionism anduncertainty willweigh oneconomic activity.Growthwill likely slow more thanpreviously anticipated in theUS, but not necessarily inChina and the Eurozone. Inthe former, lower-than-expected US tariffs back anupward revision of growthforecasts. In the latter, theimpact ofexpected UStariffswill likely be mitigated by fiscalspending, mainlyindefense. Tariffs are likely topush US inflationhigher,promptingtheFed to keep ratesunchanged forlonger.Monetaryeasing could resumebythe endof 2025ifprice pressures provetransitory.The rate-cutting cycle could beover, or at least near tothe end, in theEurozone, and remainsunderway in China. Global economy under pressure by US policies Weaker USD,higher long termyields, and acautious Fed;policy rates fellfurther in Chinaand Europe High US tariffs;although lower onChina, they arelarger thanassumed onothers, and agreatersource ofuncertainty Larger US riskamid increasingconcerns on fiscalaccounts anduncertainty on USpolicies Resilient growth;confidencedeteriorated,butimpact of tariffson activity andinflationis limited,so far Uncertainty remainsinplace US tariffs have risen sharply and erratically After some de-escalation, US tariffs rose again in lateMay/25, with levieson steel andaluminumreaching 50%;tradenegotiations continue, and disputes over the legal validity of the tariffs remainunresolved GDP stagnated in the US and grew by more than expectedin theEZand China in 1Q25amidpreemptive tradeflows Ahead of tariffs, imports and inventories increased sharply and private consumption weakenedsomewhat in the US; exports performance helped to sustain growth in China and theEurozone Growth remains relatively resilient, butthere are incipientsigns of tariff effects on activity Confidence has deteriorated and services haveweakened,while manufacturinghasbenefited fromlower interest rates and pre-tariffs tradesurge; labormarkets are losing some oftheir steam, butremain strong Inflation has eased more than expected lately; limitedeffects of tariffs so far Contained demand pressures and lower energy prices have contributed to a moderation in inflation,which remains over 2% in theUS (but not in the Eurozone anymore),to some extent due to stillpressured serviceprices The US risk premium has edged higher, weighing on long-term yields and the dollar Policy uncertainty, prospects of larger fiscal deficits, threats to the Fed independence, talks about adollar devaluation, a potential tax on foreign investors, among other factors, have pushed US risk up Financial volatility has eased more recently, afterhavingsurged in April, butremains elevated EQUITY VOLATILITY:VIX(*)(%) Upward pressure on 10-yearsovereign yieldsdue to rising risk premium in the US and fiscal spedningprospects in the EZ, to some extent offset by growth concerns, mainly in the Eurozone Despitelowerinflation, the Fed remains cautious andmarkets seelimitedroom for extra easing in the short run The likely impact of tariffs on inflation has backed the Fed’s decision to keep rates unchangedlately;The ECB cut rates to 2% in Jun/25 and suggested that, despite large uncertainty, the easing cycle isnearly over Base scenario: protectionism and uncertainty will hit theglobal economy; stimulus will support China and Eurozone A cautious Fedwill keep ratesonholdthroughyear-end;ECB’seasingcycle islikely over, butextra cutsaredependent ontariffs Market volatilitywilllikely persistamidlastinguncertainty andrising US risk,potentially hittingthe dollar Growth willmoderate,fasterthan forecast inthe US althoughtariffs may belower thanexpected;policystimuluswillsupport Chinaand Europe Inflation is set torebound in theUS,at leastin theshort-term,thanks to highertariffs, but will bearound 2%inEurozone and lowin China Prospects for US policies: baseline scenario assumptions BBVA Research baseline scenario on main US policies Tariffs Higher for longer uncertainty, although lower levies on China would imply smaller USaverage tariffs than anticipated. Working assumption: around 30% on China, 10% onMexico/Canada, average of current (as of end of May) and reciprocal (as of “Liberationday”)tariffs forothers, implying a 13pp increase in the overall US tariffs (vs. 60% on Chinaand 10% onothers,which implied a 17pp increa