Editor's Note: The following text is excerpted from the 2025 Second-Quarter Forecast ; the complete text is available to subscribers at the Focused Access level and above . The second quarter of 2025 will bring intensified trade disruptions and volatility as the United States moves forward with additional tariffs on its main trading partners, triggering retaliation from China, the European Union, Canada, Mexico and others. While negotiations may lead to compromises and the scaling down of some initial tariffs and countertariffs, overall uncertainty and volatility in global trade will persist. Beyond affecting major economies and financial markets, these trade tensions will exacerbate financial and fiscal challenges for emerging and low-income economies, many of which are already struggling with reduced U.S. aid. This quarter will also be pivotal for the war in Ukraine as Russia, the United States and Ukraine move closer to a ceasefire.