Recent economic resilience is unlikely to last

July 2025 / August 2025

Each month Oxford Economics’ team of 300 economists and analysts updates our baseline forecast for 200+ countries using our innovative Global Economic Model. Fully linking individual country models through global assumptions about trade volume and prices, competitiveness, capital flows, interest and exchange rates, and commodity prices, our model provides a rigorous and consistent structure for forecasting and understanding the impact of economic shocks. Below is just the top-level summary of our analysis of the latest economic developments.

• We’ve raised our world GDP growth forecasts for both 2025 and 2026 by 0.1ppt to 2.5%.
• This year’s adjustment is mainly due to better-than-expected growth in H1.
• However, the quarterly pace of growth should ease from here as the impact of order frontloading ahead of higher tariffs fizzles out.
• We are still more pessimistic about global growth prospects in H2 2025 and early 2026 compared to our forecasts prior to the US ‘liberation day’ announcements in April.

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