Brian Jeffrey
The global economic landscape in 2025 is expected to be fraught with uncertainty, greatly influenced by the policies of President Donald Trump. There are concerns about rising inflation, with gold and the U.S. dollar predicted to maintain strong positions, alongside fears of economic bubbles potentially bursting.
Forecasts for 2025 suggest an unpredictable global economy, with increased tensions. While significant growth is possible, there are risks of stagflation, a situation characterized by stagnant growth and high inflation.
The possibility of renewed inflation looms, especially with the chance of rekindled trade conflicts between the U.S. and countries like China. Trade wars could escalate prices for goods, consequently raising gold values and solidifying the strength of the U.S. dollar.
The U.S. dollar has already seen substantial gains, and it might climb further, leading to volatility in global financial and currency markets. This could result in capital fleeing emerging markets, which would affect currency stability and economic conditions in countries like Vietnam.
Stagflation poses a serious risk, especially considering Trump’s aggressive trade and immigration policies. If the U.S. undergoes a “hard landing,” it may trigger widespread consequences for economies including China, Europe, and Vietnam.
BlackRock, a leading asset management firm, has expressed caution, suggesting that a downturn in the U.S. economy could occur if Trump’s strategies do not succeed. Rising inflation tied to increased demand, coupled with a potential slowdown in economic progress, could also devastate tech valuations, leading to a collapse of the artificial intelligence sector.
Despite these warnings, several financial institutions, including BlackRock, Goldman Sachs, and S&P Global, convey a moderately optimistic outlook compared to early 2024 estimates.
Goldman Sachs anticipates a global growth rate of 2.7% for 2025, with the U.S. faring even better at 2.5% (a revision from the earlier prediction of 1.9%). Meanwhile, the OECD expects the global GDP to rise by 3.3%, slightly above the 3.2% forecast for the previous year.
Conversely, the eurozone is projected to see a decrease in growth to 0.8%, falling short of a 1.2% estimate by Bloomberg analysts, likely due to trade policy changes under Trump’s administration.
Following Trump’s reelection, there was a notable shift in global financial markets. The U.S. dollar experienced a significant increase, central banks expedited rate cuts, and China added liquidity to bolster its economy.
S&P Global forecasts that inflation will rise in 2025, prompting the Federal Reserve to likely slow or stop interest rate cuts sooner than expected. This would further enhance the dollar’s strength.
Goldman Sachs has updated its interest rate forecasts, indicating that the Fed is likely to hold rates steady until January, with cuts anticipated in March, June, and September. The final rate is now projected to fall between 3.5%-3.75%, slightly up from a prior estimate of 3.25%-3.5%.
Gold prices are expected to benefit from global reductions in interest rates and demand from central banks, though growth in prices may slow if rates are subsequently reversed. The World Gold Council forecasts that gold will see significant price variations in 2025, expected to average around $2,750/ounce (a 14% increase from 2024), fluctuating between $2,500-$3,200/ounce.
Nicky Shiels from MKS PAMP indicates that the trajectory towards $3,000/ounce will hinge on the Fed’s approach to inflation indicators. An aggressive stance could weaken the dollar, boosting gold’s value by late 2025.
For Vietnam, this global economic instability could bring fresh challenges. Economic analyst Dr. Nguyen Tri Hieu cautions that Trump’s trade stance might adversely impact Vietnam. In contrast, Barry Weisblatt David from VnDirect Securities perceives potential advantages from Trump’s tariffs on China, Mexico, and Canada, which could present opportunities for Vietnam.
Persistently high inflation risks in the U.S. might keep the dollar robust, thereby intensifying pressure on the Vietnamese dong. VnDirect anticipates that the State Bank of Vietnam may raise interest rates to counteract exchange pressures.
Weisblatt believes that additional tariffs on Vietnam are unlikely given Trump’s positive relations with the country. Instead, the U.S. might implement trade defense measures, particularly regarding the origin of imports.
According to Dr. Luong Van Khoi from the Central Institute for Economic Management, changes in U.S.-China policies could redirect investments from China to Vietnam.
