Trump tariff recession: Worry about recession in the Trump era? Experts send an alert; here’s what you can do now to protect your money

Economists warn that President Donald Trump’s tariff policies are unstable and consumer confidence could plunge the United States into a 2025 recession. Recent data, including a 10.5% drop in the University of Michigan’s consumer sentiment index, reflects anxiety about inflation and market instability. Experts such as David Rosenberg of Rosenberg Research highlight unprecedented policy uncertainty, killing business plans and eroding economic resilience. Diane Swonk of KPMG pointed out that the risk of recession is close to critical levels, driven by turbulent trade such as sudden steel tariffs and the threat of 200% imposition of EU goods.

The year-on-year inflation outlook soared to 4.9% in March, the highest since 2022, while the long-term forecast reached 3.9% with a peak of 30 years. Despite signal mixing (e.g. flat wholesale prices), consumers in all demographics reported reduced confidence. Pushpin Singh of the Center for Economic and Business Research warned that unpredictable tariff reversals have created an “a atmosphere of uncertainty” that has hindered business expansion and household spending.

Navigating economic turmoil: Survival strategies

If the recession strikes in 2025, economists can predict continued inflation, raising interest rates and rising unemployment rates, with the current 4.1% hit rate of 5%. Gary Hufbauer predicts that UC GDP will drop 1-2% by mid-2025, while UC Berkeley’s Jesse Rothstein warned that this could be related to past declines, driven by commercial layoffs rather than financial crisis.

FAQ:

What are the fears that drive the recession in 2025?
Volatile Trump tariffs, policy triggers and declines in consumer confidence are key factors, and inflation expectations and business uncertainty continue to rise.

How do individuals prepare for potential recession?
Reduce debt, build emergency savings, diversify investments into stable assets such as gold, and cut non-essential expenses for weather economic turmoil.