U.S. Economic Growth Slows Amid Tariff Pressures: A 2025 Outlook

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📉 U.S. Economic Growth Slows Amid Tariff Pressures: A 2025 Outlook As 2025 unfolds, the U.S. economy is showing signs of strain amid a global slowdown and heightened trade barriers. Here's a detailed look at the latest forecasts and implications based on insights from the OECD, Federal Reserve, and key market indicators . 📊 1. U.S. Growth Forecast Downgraded by OECD The Organisation for Economic Co-operation and Development (OECD) has revised the U.S. GDP growth forecast for 2025 to 1.6% , down from 2.8% in 2024 . The forecast for 2026 remains muted at 1.5% , reflecting persistent uncertainty driven by: Elevated trade barriers Reduced consumer spending power Sluggish business investment 💸 2. Tariffs Fueling Inflation & Trade Costs The average U.S. tariff rate has climbed to 15.4% , the highest level since 1938 . These tariffs have raised import costs, which are now being passed on to consumers: Projected consumer price inflation is expected to rise to...
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National Income and controling inflation

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National Income refers to the total value of all goods and services produced within a country's borders during a particular time period, typically a year. The components of national income can be broadly classified into four categories:

Gross Domestic Product (GDP): It is the sum of all final goods and services produced within the domestic territory of India during a given year. It includes consumer spending, investment spending, government spending, and net exports.

Net Factor Income from Abroad (NFIA): It is the difference between income earned by Indian residents from foreign sources and income earned by foreign residents in India.

Net indirect taxes: These are taxes imposed on the production and sale of goods and services, such as excise duty, sales tax, and value-added tax. The net indirect taxes are calculated as indirect taxes collected by the government minus subsidies given by the government.

Depreciation: It is the value of the capital used up in the production process during the year. It includes the wear and tear of machinery, buildings, and other physical assets used in production.

Therefore, the components of India's national income include GDP, NFIA, net indirect taxes, and depreciation.



There are several measures that can be used to control inflation, but here are two commonly used measures:


Monetary Policy: This involves adjusting the money supply and interest rates by the central bank of a country. When inflation is high, the central bank can increase interest rates, which reduces borrowing and spending by businesses and individuals. This decreases demand in the economy, which can help to reduce inflation. Similarly, the central bank can decrease interest rates to stimulate borrowing and spending in the economy during periods of low inflation.


Fiscal Policy: This involves the government's use of taxation and public spending to influence the economy. During periods of high inflation, the government can decrease spending or increase taxes to reduce the amount of money circulating in the economy. This can reduce demand and help to control inflation. Alternatively, the government can increase spending or reduce taxes during periods of low inflation to stimulate demand and boost economic growth.


Supply-Side Policies: These policies are aimed at increasing the supply of goods and services in the economy. This can be done by reducing trade barriers, investing in infrastructure, improving technology, and encouraging competition in the market. By increasing the supply of goods and services, the prices of these goods can be reduced, which can help to control inflation.


Wage and Price Controls: These measures involve setting limits on the wages and prices of goods and services. The government can set a maximum wage increase for workers or impose price controls on essential goods such as food and medicine. However, this measure is often controversial, as it can lead to unintended consequences such as shortages, black markets, and reduced investment in the affected industries.

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