The U.S. economy has a 40 percent chance of going into a recession in the second half of 2025, analysts at JP Morgan said on Wednesday, warning that higher tariffs are weighing on economic growth.
The investment bank said that tariffs could squeeze both consumer purchasing power and corporate profit margins.
In light of these risks, JP Morgan has downgraded its U.S. economic growth forecast for 2025 from 2 percent to 1.3 percent. Analysts also pointed to a concerning mix of slow economic output and persistent inflation, which they say bears resemblance to the 1970s era of stagflation.
JP Morgan said it expects the Federal Reserve to take a cautious approach to monetary easing, projecting only 100 basis points of rate cuts by spring 2026. This slower pace would likely lead to tighter financial conditions for an extended period, adding pressure on businesses and consumers alike.
JP Morgan warns of possible US recession in 2025
President of the Republic of Korea (ROK) Lee Jae Myung has expressed his hope that his upcoming visit to China will help eliminate past misunderstandings and issues, underscoring the importance of ties between the two countries.
At the invitation of Chinese President Xi Jinping, Lee will pay a state visit to China from Jan 4 to 7. It will be Lee's first visit to China since he took office.
In an interview with China Media Group (CMG) in Seoul on Wednesday, Lee acknowledged the existing misunderstandings and issues between the two countries, noting that addressing these issues is a key goal of his visit.
"The current international landscape is turbulent, with escalating issues among various countries. In this context, the relationship between the Republic of Korea and China holds significant importance for us. the ROK and China are deeply interconnected in many areas, including history, economy, geopolitics, politics and security. Northeast Asia's peace, stability, mutual respect, and common prosperity are crucial for both countries," said Lee.
"Admittedly, there have been some misunderstandings and issues between the ROK and China, which have hindered the development of bilateral relations to some extent. Therefore, the purpose of my upcoming visit to China is to minimize or eliminate these past issues, foster a leap in our bilateral relations to a new level, and solidify the ROK and China as partners that mutually support each other's development," he said.
ROK President hopes to reduce misunderstandings with China during upcoming visit
