Oxford Economics is proud to launch the 2025 update of the Global Cities Index, which offers an evaluation of the world’s 1,000 largest urban economies.
Sally Li
From executive orders to federal lawsuits against state-level climate policies, the Trump administration has acted with urgency to reverse the low-carbon momentum built under President Biden.
We expect the peak economic drag for China from the exogenous demand shock generated by higher tariffs to occur in Q2 and Q3 this year.
GDP growth likely to be revised up but will remain weaker than assumed prior to Liberation Day.
The latest US-China tariff deal suggests less of a drag on the economy through the rest of this year.
We will not change our US forecasts based on the latest US-UK deal and what it signals for future agreements.
With more variable renewable energy (VRE), we expect electricity prices to rise in the short term.
Our new suite of sentiment indices show global CRE sentiment has deteriorated significantly this year.
The significant escalation in US tariffs since early April is set to generate a shallow recession in global industry, though growth will remain positive in annual terms.
We appear to be witnessing the beginning of a new global economic and market paradigm. We expect five key trends to endure.
Electronics, electricals, motor vehicles, pharmaceuticals and machinery are most exposed globally to US-imposed tariffs.
Most commodity price forecasts are cut due to tariffs except for gold and battery metals, which show resilience amid global market shifts.
Europe’s major city economies, on average, are fairly well-insulated. However, within this group there are still some notable variations.
We have trimmed our all-property capital growth forecast to 1.5% pa over 2025-2026. The industrial property sector is set to be hit hardest.
There are no absolute winners in a trade war, but some will fare relatively better than others.
We expect GDP growth in both the US and world economy to slow sharply due to the tariff hikes, but we don’t anticipate recessions in either.
The increase in tariffs announced so far will add more than 10ppts to the cost of business equipment in the US.
The sectors most exposed to mass deportations are construction, agriculture, parts of manufacturing and several service sectors.
To really understand exposure to risk, you need to look at how a business interacts with the broader economy.
If the full April 2 tariffs are implemented alongside the additional 125% China tariff, this would push the US into a recession.
