The Brookings-FT Global Economic Recovery Tracker (Tiger) indicates that global economic growth faces rising threats due to U.S.-driven trade shocks impacting confidence and financial markets. The index shows a significant decline in confidence indicators alongside deteriorating financial market conditions. This decline contrasts sharply with the relatively stable situation at the beginning of the year.
Brookings Institution Senior Fellow Eswar Prasad suggests it is premature to predict a global recession. However, he warns that a collapse in global trade and increasing policy uncertainty will significantly hinder economic growth. Prasad notes that every open economy reliant on trade will face pressure, further impacting confidence negatively.
The index compares real activity, financial markets, and confidence indicators of developed and emerging economies against historical averages. The report highlights that U.S. confidence data is particularly concerning, showing the lowest levels since the index's inception, alongside a sharp deterioration in financial market conditions. Despite this, U.S. real economic activity indicators remain relatively strong, though these are based on data up to January 2025, preceding the implementation of recent trade policies.
