Rolling coverage of the latest economic and financial news, as US markets slide after Beijing imposes tariffs on imports of agricultural goods from America

Analysts at investment bank Jefferies remain optimistic about the prospects for the US economy in the second half of 2025 – while also fearing that it may slow more than expected in the first half of the year.

In an updated US Economic Outlook, Jefferies tell clients:

Broadly, these changes are modest relative to what we were looking for at the beginning of the year. We started out 2025 expecting growth to slow in the first half due to exactly the sort of tensions and uncertainty about policy that we are currently seeing. It now appears that the slowdown will be a bit more pronounced than we expected, but we remain optimistic about the second half of the year and beyond.

We expect that the labor market will continue to cool gradually in the months ahead, with downside risks due to government spending uncertainty. We continue to expect that the Fed cut rates again in June, followed by 2 more 25 bp cuts, but we’re now expecting they will be back-to-back in July and September (rather than every-other-meeting).

‘’Unease about the effect of Trump’s tariffs hangs over financial markets at the start of the week. The prospect of a recession in the US is lurking, with consumer confidence falling, companies facing increasing trade complexity and investors turning more nervous. China’s deflation problem is also weighing on sentiment, and geopolitical concerns are staying in focus, with attacks on Ukraine intensifying.

The FTSE 100 is on the back foot in early trade, unable to shake off the nervousness surrounding the concerns about slowing global growth.