Fitch: Fed expected to delay rate cut until Q4 2025

On 18 March, international rating agency Fitch said it had lowered its 2025 economic growth forecast for the US to 1.7% from 2.1%. The U.S. government has opened a global trade war that is expected to reduce U.S. and global growth, raise U.S. inflation, and delay the Federal Reserve's interest rate cut. Looser fiscal policies in China and Germany will cushion the impact of higher US import tariffs. Economic growth in the euro area is expected to be lower this year than forecast in the December 2024 Global Economic Outlook (1.2 per cent). The tariff shock is expected to add 1 percentage point to short-term inflation in the US, and the Fed is expected to delay further rate cuts until the fourth quarter of 2025.