Coming off a surprisingly strong 2024, the U.S. economy is likely to enjoy growth again in 2025 – albeit at a more modest pace – according to Rabobank Head of Cross-Asset Strategy Christian Lawrence.
However, Lawrence warned there are several factors that could stymie that predicted growth and cast uncertainty onto the U.S. economy.
Lawrence, who gave a presentation titled “2025 Macroeconomic Outlook – A return to ‘shellfish’ trade policy” at the 2025 Global Seafood Market Conference in Palm Desert, California, U.S.A., on 21 January, said that the U.S.’s strong economic performance in 2024 was largely due to slowing inflation on goods, real wage growth that brought average salaries closer in line to the cost of living, and healthy unemployment rates.
This resulted in few drops in consumer spending throughout the year – a trend that played out across several industries, including at U.S. retail stores, where year-over-year total food and beverage sales rose 1.3 percent to USD 922 billion (EUR 903 billion) – and GDP growth of nearly 3 percent.
"The economy performed really well in 2024, and the main driver was consumers, who are still doing well," Lawrence said.
Though Lawrence expects both unemployment and inflation rates to be higher in the U.S. in 2025 – above 3 percent and just under 5 percent, respectively – he still anticipates the economy will grow, the U.S. dollar will remain strong, and the Federal Reserve will largely leave interest rates alone.
Nevertheless, factors like rising credit card debt, depleted savings, and falling supply and demand in the U.S. housing market could throw a wrench into those predictions if they get too severe, according to Lawrence.
Even more pertinent, the recent start to Donald Trump’s second presidential term is expected to add unpredictability to the global economic environment, he said.
“I was recently asked the top three things to look out for in macroeconomics over the next year,” Lawrence said. “My answer was Trump, Trump, and Trump.”
Trump has continually threatened wide-sweeping tariffs on goods from Mexico, Canada, and China – a move which, if enacted, could affect up to USD 5.6 billion (EUR 5.4 billion) worth of seafood and alter trade in myriad other industries.
Lawrence is not convinced any tariffs will be wide-sweeping, despite Trump’s claims to the contrary; instead, he speculates that any tariffs enacted under the new administration will be more nuanced and used as a tool to affect foreign policy.
“Tariffs can, in some instances, make sense and be good for an economy. For example, [former U.S. President Joe] Biden didn't remove Trump’s tariffs from his first term; he added to them. Combating subsidies with tariffs can make sense in some instances,” he said. “I don't think there will be a broad, sweeping tariff on absolutely everything. Broad-based tariffs would absolutely have a negative impact on the economy. I think things will be more nuanced.”
Yet, sectors like the Canadian lobster industry are not sitting on their heels waiting to see whether Trump’s tariffs are targeted or broad.
"If it's three months of tariffs, it's not going to impact us dramatically," Geoff Irvine, the executive director of the Lobster Council of Canada, said in a recent CBC interview. "If it maintains, though, into the very busy spring season, that's when we'll start to feel it."
According to the CBC, this uncertainty has caused the Canadian lobster industry to diversify the markets to which it sells, recently expanding and opening trade relationships in Europe, China, South Korea, and the Middle East while simultaneously lobbying U.S. representatives to ensure tariffs on the shellfish don’t come to pass.
Trump has also threatened mass deportations of immigrants in the U.S., which could constrict an already tight U.S. labor market, according to Lawrence, who explained that immigrants have helped to fill the gap created by retirements of workers above the age of 55 in the wake of Covid-19.
“I think it’s fair to say that under the Trump administration, the rate of migration is going to slow,” Lawrence said, adding that the U.S. will also certainly see deportations under Trump, but as for its effects on the economy, it, like the tariffs, depends on the scale.
Among the effects an increase in deportations and a decrease in migration would have on several sectors of the U.S. economy, many seafood processors rely on foreign workers to fill seasonal positions. The visas that typically allow them to work legally in the U.S. have also been the subject of heated debate among current and former advisors to Trump.
Even though Lawrence’s predictions for the 2025 U.S. economy are cautiously optimistic, he advised that the uncertainty clouding the Trump administration makes it difficult to offer forecasts with absolute certainty.
"Trump makes [the economic landscape] more dramatic with the headline noise he creates,” Lawrence said. “It makes it difficult to get accurate predictions in place. For markets, it means things are going to move around a lot."
