Inflationary Pressure and Monetary Policy Uncertainty Among Key Concerns in 2025

Last month, the U.S. economy displayed resilience amidst a transitioning monetary policy and external disruptions but faced ongoing challenges in housing affordability, labor market cooling, and inflationary stickiness. Growth prospects also remain modestly positive, with fiscal and monetary adjustments likely to play key roles in 2025. Despite having a positive outcome for November, ITS Logistics’ November ITS Supply Chain Report outlines several key risks that could impact growth and stability in the near term.

“Recent data indicates that inflation remains a concern, with the Personal Consumption Expenditures (PCE) price index expected to rise by 2.5% in November, up from 2.3% in October,” says ITS Logistics CFO Stan Kolev. “This upward trend suggests that inflation is becoming more persistent, which may compel the Federal Reserve to maintain higher interest rates for an extended period, potentially dampening economic growth.”

Key takeaways:

• Key concerns include inflationary pressure, monetary policy uncertainty, global economic uncertainty, and consumer confidence.
• While the global economic environment presents additional risks, the European Union’s economy is returning to modest growth after a period of stagnation. However, geopolitical tensions and energy security concerns pose significant uncertainties.