IMF Upgrades U.S. Economic Forecast as Trump Plans White House Comeback

The International Monetary Fund (IMF) has recently revised its economic forecast regarding the United States, projecting a more optimistic growth trajectory for 2025. According to the latest World Economic Outlook report, the IMF now anticipates a growth rate of 2.7 percent, up from a previous estimate of 2.2 percent. This upward revision is largely credited to the strength of the labor market and a surge in investment activities, which have gained momentum following President-elect Donald J. Trump’s decisive 2024 election victory.

In contrast, the IMF has adjusted its growth predictions for Europe downwards, citing significant hurdles within the manufacturing sector and heightened political uncertainties. Pierre-Olivier Gourinchas, the IMF’s chief economist, underscored this growing economic divergence between the U.S. and other regions. During a press call, Gourinchas remarked, “The big story is the divergence between the U.S. and the rest of the world. We have stronger potential output growth in the U.S. compared to pre-pandemic, and we have weaker potential growth in other areas, like the euro area or China.”

The IMF’s revised forecasts are grounded in its October analysis, which pointed out that global growth has yet to return to the levels seen before the pandemic. However, fears of a dramatic post-pandemic economic downturn have been largely dispelled. The updated report forecasts that global output will expand by 3.3 percent this year and next, slightly surpassing earlier predictions.

Despite these promising numbers, the IMF has sounded a note of caution regarding economic policy uncertainty, particularly from newly elected governments around the globe. The IMF suggests that President-elect Trump’s agenda, which includes tax cuts, deregulation, tariffs, and immigration restrictions, could potentially lead to increased inflation. However, some argue that immigration restrictions and tariffs tend to have a deflationary effect by reducing consumption, a point emphasized by Trump’s Treasury Secretary nominee, Scott Bessent. On the other hand, deregulation is often associated with lower costs and prices, which could mitigate inflationary pressures.

In Europe, tech billionaire Elon Musk has been stirring controversy with his political comments. He has criticized Britain’s far-left Labour government over the issue of Pakistani grooming gangs and has endorsed Germany’s populist Alternative for Germany (AfD) party ahead of the federal elections in February. However, public opinion polls indicate that Musk’s interventions are not well-received. A YouGov EuroTrack survey reveals that 71 percent of the population in both Germany and Britain view Musk unfavorably, with only a small minority holding a favorable opinion of him.

Critics argue that Musk lacks a deep understanding of the political climates and challenges facing these countries. A grooming gang victim in Britain criticized Musk for his comments, labeling them unhelpful and accusing the billionaire of being narcissistic. Public sentiment in both Germany and Britain strongly opposes foreign political figures influencing domestic politics. Around 74 to 76 percent of citizens in these countries reject such interventions, including those from American figures like Musk. Similarly, about 72 percent of respondents are against European interference in U.S. political affairs.

While Musk enjoys somewhat higher popularity among supporters of Germany’s AfD and Britain’s Reform Party, led by Nigel Farage, even these groups believe his influence on their national political landscapes is limited. Overall, few in Britain and Germany expect Musk to have a significant impact on politics in their countries, with only about 18 to 22 percent of respondents believing he holds any sway.

In the United Kingdom, the ruling Labour Party has blocked attempts to outlaw marriage between first cousins, a practice common in the country’s Muslim community. Conservative Member of Parliament (MP) Richard Holden expressed disappointment over Labour’s decision to prevent the bill from advancing further. On social media, Holden accused Labour of likely continuing to block such legislation in the future and acknowledged the support he received from communities where cousin marriage is prevalent.

Cousin marriage is particularly common in Britain’s Pakistani community. According to the BBC, as many as 46 percent of newborns to Pakistani parents in Bradford are born to first cousins. Iqbal Mohamed, an MP for Dewsbury and Batley, defended the practice in the House of Commons, arguing that it helps build family bonds. Meanwhile, Britain’s National Health Service (NHS) has downplayed the health risks associated with cousin marriages, despite known concerns about congenital anomalies. The NHS compared these risks to those faced by White British women who choose to give birth after the age of 34.

However, statistics show that cousin marriages appear to be more dangerous, with children born to such couples accounting for a significant percentage of birth defects in Bradford. These marriages are also associated with lower IQ and higher rates of mood disorders and psychoses, raising additional public health concerns.

In the United States, a former director of a shelter in Massachusetts has raised issues with the state’s right-to-shelter laws. Jon Fetherston, who managed the Marlborough Holiday Inn shelter, criticized the lack of vetting for illegal immigrants benefiting from these laws and the subsequent strain on state resources. Massachusetts has spent approximately $1.1 billion this fiscal year to accommodate migrants, often using hotels as temporary shelters. This situation has sometimes left local citizens without access to these facilities.

The right-to-shelter law in Massachusetts was established in 1983 and mandates housing for displaced families and pregnant women. Even though shelters reached capacity in 2023, they continue to serve an increasing number of illegal immigrant families. Fetherston has reported incidents of violence within these shelters and criticized the lack of consequences for those responsible.

Particularly concerning to Fetherston was the arrest of Leonardo Andujar Sanchez, who allegedly had drugs and a firearm while staying in state-funded housing. Although the state’s Executive Office of Housing and Livable Communities claims to perform regular security checks, Fetherston says he did not observe this during his time at the shelter. Governor Maura Healey has called for more rigorous vetting to ensure that shelter occupants are legally residing in the U.S. However, Fetherston questions the feasibility of this plan without proper identification, noting that he has had to deny shelter to American citizens, including veterans, due to the presence of illegal immigrants.