UK growth forecasts hit by Trump’s tariffs

Donald Trump’s trade war helped push the UK growth horizons this year to a third of them decreased, although Britain is less exposed to the welfare of the American president than its largest partners, as economists were suffering from weaker confidence and investment.

The GDP in the United Kingdom will grow only by 0.8 percent this year, according to 10 expectations that were conducted after Trump revealed an aggressive global tariff on April 2, a decrease from the consensus of 1.2 percent expected in January, according to the Financial Times research and consensus quote, a survey company.

The strike is likely to mean high unemployment, driven by the losses of jobs that focus on manufacturing directed towards export, as analysts predicted. But it is expected that it will stimulate the damage to the Bank of England’s discounts faster to borrow the costs, which reduces some pressure on families.

“The great economic result is now guaranteed, just because of the uncertainty that Donald Trump created,” said Rob Wood, an economist in Panton’s economic consultations. “No one is completely sure of the period when the customs tariff will remain in place, the extent of Trump’s openness to negotiation, and what is the size of revenge.”

The US President applied 10 percent of the foundation line to the UK, which has a balanced trade relationship with America. Economics that export more goods have been delivered to the United States more than they import a larger tariff depending on the size of the deficit. The European Union hit 20 percent, for example.

The Trump system did not include services exports, which constitute the majority of annual exports of 900 billion pounds, about 900 billion pounds. However, Chancellor Rachel Reeves warned of “deep” challenges to the global economy because she took questions in the House of Commons on Tuesday.

The global turmoil raised by the Trump tariff will affect the UK economy barely growing in the second half of last year and a little contract in January this year.

Some British companies have warned that they had been weighed by 25 billion pounds of the taxes imposed by Reeves last October and the latest increase in the minimum wage, both of which entered this month.

The Budget Responsibility Office, the official government forecast, started its growth expectations for the year 2025 last month to reach only 1 percent, still more pink than the image that was now seen after Trump’s ads on April 2.

In addition to a 10 percent foundation tariff, the UK was also hit by 25 percent of auto exports to the United States, as well as a steel tariff.

Sandra Horsfield, economist at Investec, said, but low global demand will make the impact larger, that the direct impact of the high customs tariffs on the United Kingdom “is likely to be relatively small.”

Add to this negative effect of uncertainty on investment and employment, as well as the effect, provided that it is sustainable, [sterling’s] She added that reinforcement, and beating to GDP may be greater.

Sanjay Raja, an economist at Deutsche Bank, said that the customs tariff may lead to losses in 50,000 to 100,000 jobs in the short term, giving 72,000 jobs created in the three months to January.

Jack Meaning, Barclays economist, reduced the US growth forecast for 2025 to 0.5 percent after announcing the customs tariffs from 1 percent of.

He explained that this is a “material reduction”, and a large part of that comes from the uncertainty that weighs consumers ’decisions to spend and investor decisions to make investment. “

Some economists expect a smaller blow to growth, partly because they expect UK source to benefit from relatively low definitions in the country. Andrew Weizart, economist at Brenberg Bank, has reduced the US growth expectations of 2025 to 0.9 percent of 1 percent. He said that the United Kingdom “is in a good position to overcome the shock of the tariff.”

In the short term, there may be a silver lining for British consumers despite the blow to growth. Most of the UK workers in the country’s dominant services sector, as wage growth has been relatively high even with low inflation during the past 18 months.

Brent crude oil fell to a four -year lowest level on Monday before the rise on Tuesday increased, a decrease that may lead to an increase in the pressure of inflation. The exchange rates, which determine the mortgage rates, also decreased, and if they continue, it may help in the financial affairs of the family and support the prices of homes.

Traders are pricing three price cuts by the Bank of England this year, with the expectation of the next meeting, which will help reduce pressure on the economy. In addition, a flood of reduced consumer products is expected to reach Europe where China is struggling for sale in the United States, analysts said.

“In the short term, we can already see a deviation in the United Kingdom where international prices will decrease because the goods that were scheduled for the American market are now overwhelmed by other countries,” said Eric Gulson, assistant professor at Sari University.

He warned, “However, in the long run, we will see side inflation in the offer because the global value chains have achieved significant growth and less prices over the past 25 years will collapse.”