

Global Data Pod Weekender: Taking stock at midyear
7 snips Jun 27, 2025
The conversation dives into an anticipated stagflationary shift in the economy, highlighting a drop in global GDP growth and rising inflation due to US tariffs. Market signals suggest a surprising optimism around potential Fed easing amid softening labor conditions. The hosts banter about oil prices and geopolitical tensions, while analyzing the outlook for 2026-2027, balancing caution and resilience. Tariff impacts on Asian trade dynamics are explored, specifically between China and its neighbors, adding complexity to the future economic landscape.
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Stagflationary Outlook vs Market Optimism
- The mid-year outlook predicts a stagflationary tilt led by the US in the second half of 2025 with significant growth downshift and rising inflation.
- Markets appear optimistic, underpricing the risk of economic softness and potential Fed easing.
Economic Momentum Loss Expected
- There's conviction about a sharp momentum loss in US growth but uncertainty on its magnitude.
- Global industrial production overshoot is expected to revert, signaling an ongoing economic downshift.
Business Absorption Key to Avoid Recession
- If the tariff shock acts as a substantial tax hike, businesses must absorb the drag to avoid a recession.
- This absorption will compress margins, soften growth, and reduce pricing power going into 2026.