Week Ahead Economic Preview: Week of 7 July 2025

The following is an extract from S&P Global Market Intelligence’s latest Week Ahead Economic Preview. For the full report, please click on the ‘Download Full Report’ link.

Economic risks in focus as tariff deadline looms

Fed minutes, UK GDP and inflation data for mainland China are key releases in a week which is likely to be dominated by the looming US tariff deadline.

April’s pause on higher US tariffs is due to expire on 9th July, in theory resulting in far higher levies on goods exported to the US for economies that have yet to secure trade deals. Few deals (notably the UK, Vietnam and a framework with China) have so far been announced at the time of writing, meaning countries will be eager to secure extensions.

Fed policymakers will be eager to learn what the tariff landscape is going to look like. The FOMC’s wait-and-see approach to interest rates weighs up the risks of higher tariff-related inflation against the dampening effects on growth and hiring from recent US policy changes. A guide to policymaker views on potential rate cuts will come from the minutes of the last FOMC meeting, which saw interest rates on hold. While there have been recent signs of splits toward a more dovish stance, PMI and payroll data have indicated a resilience in the economy alongside rising price pressures, supporting the postponement of rate cuts until later in the year.

The health of the UK economy will also come under scrutiny with GDP data for May. April’s 0.3% decline had indicated a marked deterioration after 0.7% growth in the first quarter. Another weak month would add to fears that the UK economy is spluttering amid headwinds of trade uncertainty, Budget measures which led to higher payroll costs starting in April, and low consumer confidence. However, the PMIs suggest that these headwinds have started to ease.

Meanwhile, industrial production data for Germany will be eyed for signs that rising domestic demand (linked to prospects for greater fiscal spending) will have helped offset some of the dampening impact of global trade tensions, while trade data will be assessed for tariff impact.

In APAC, rate cuts are on the table as central banks in Australia, New Zealand, South Korea and Malaysia weigh up prospects amid US trade uncertainties. The deflationary impact of US trade policies has been especially evident in mainland China, according to PMI data, drawing focus on the upcoming consumer price data to be released in the week.

Finally, the S&P Global Investment Manager Index for June will gauge appetite for risk and equity market preferences. amid the changing political and economic environment. Read May’s IMI, which showed easing risk aversion, here.

The outlook for US interest rates will come under scrutiny via the publication of FOMC meeting minutes, which saw rates on hold in June, a decision in line with recent PMI data.

UK GDP growth is expected to have improved in May after a disappointing 0.3% decline in April.