Economies and Consumers in 2025: Key Trends to Watch

In 2025, geopolitics, potential policy changes from the US and demographic shifts will be the three key drivers shaping the global economic and consumer landscape. Economies, businesses and consumers will face both challenges and opportunities arising from sluggish economic and income growth, increasing trade protectionism and tariff risks, regulatory pressure, consumer cautiousness, and the growing influence of the 65+ age group. 

Global growth to remain stable but sluggish with multiple downside risks

Aleksandra Svidler – Senior Consultant

The global economy is projected to grow steadily by 3.2% in 2025, supported by easing inflation and lower interest rates. Falling costs and improving financing conditions are expected to provide some relief, boosting investment and consumer spending. However, growth will likely remain sluggish, falling short of the pre-pandemic 10-year average of 3.7%. Rising geopolitical risks and economic fragmentation, and lingering uncertainties continue to weigh on business and consumer sentiment.

Moderating inflation and monetary easing, alongside stabilised supply chains, create a foundation for cautious optimism. In 2025, businesses must adapt to a slower growth environment and address heightened risks by building operational resilience, focusing on cost efficiency, leveraging innovative solutions to enhance productivity and exploring untapped markets.

Trump’s economic policy to impact global growth, supply chain and consumer prices

Lan Ha – Head of Economies and Consumers Insights

The economic agenda implemented by US President Donald Trump in his second term will shape the macroeconomic narrative in 2025 and beyond, with potential tax, immigration and tariff shifts impacting everything from consumer spending to supply chain resilience. 

Trump’s proposed tax cuts can deliver short-term boosts to business investment and consumer income in the US. However, in the medium term, the positive effects of tax cuts could also be offset by the negative impacts of supply-side constraints resulting from Trump’s other policies, namely increased tariffs and immigration controls. If Trump’s pledges on tariff hikes materialise, global trade tensions will rise with retaliation and increased trade protectionism that can go beyond the US and China.

Under a Total Trump Agenda scenario, global economic growth could be slashed by a total of 2.5 percentage points from the baseline in the first three years of shock

^{Source: Euromonitor International}

Global businesses will have to navigate a more complex trade landscape, while nearshoring and reshoring are expected to rise as companies face a more pressing need to reduce dependence and build resilience by diversifying their manufacturing bases and supply chains. To navigate the upcoming fast-changing economic environment, businesses must sharpen their market foresight and adopt proactive strategies to manage risks and capitalise on evolving opportunities.

Consumer cautiousness becomes permanent, but selective spending provides optimism

Jana Rude – Senior Manager

In 2025, global consumer price growth is forecast to slow to 4.2%, while disposable income is projected to increase slightly faster at 4.7% in nominal terms, offering some relief after a prolonged period of escalating living costs. Nevertheless, economic uncertainty, a widening income gap and high prices will keep consumer spending growth subdued at 4.3% in nominal terms (2.4% in real terms) in 2025.

For a fourth consecutive year, cautiousness is expected to remain the dominant theme for consumers

^{Source: Euromonitor International}

To thrive in 2025, consumer goods companies will need sharper consumer segmentation, deeper behavioural insights and precise product positioning to adapt to evolving consumer spending preferences and identify growth opportunities. Navigating the changing consumer landscape demands a 3As approach: agility, to swiftly respond to shifting consumer behaviour; adaptation, to align strategies with diverse consumer value; and alignment, to ensure business goals resonate with priorities, unlocking value beyond price competition.

Growing opportunities among mature consumers, particularly in Europe

Jana Rude – Senior Manager

By 2025, the global population of mature consumers aged 65+ will increase by 23.7 million to reach a total of 855 million, accounting for 10% of the world’s population. Europe, the most aged region, will lead this demographic shift, with one in five residents aged 65 or older in 2025. The economic power of the 65+ age cohort also rises alongside their numbers.

In 2025, the average annual gross income of the global population aged 65+ will increase to USD20,370, lower only than that of the 55-64 age cohort

^{Source: Euromonitor International}

Notably, Europe’s affluent consumers aged 65+ will grow by 3.4%, representing nearly 20% of social class A (the highest-income group) in the region, compared to just 9% globally. As Europe will edge closer to becoming a super-aged society, it will offer fertile ground for businesses targeting mature consumers. Busting outdated stereotypes and understanding the evolving needs, behaviours and aspirations of this powerful demographic will be critical. Brands that adapt swiftly and strategically can lead the way well beyond 2025.

Growing regulatory pressure challenges businesses, but reinforces opportunities for sustainable and healthy products

^{Aiste Bijune – Consultant}

The rise of diverse regulations, driven by rising sustainability, governance and health standards, is set to shape business practices globally in 2025 and beyond.

51.4% of companies expect moderate to extensive impacts from regulatory changes on their business in the year to come

^{Source: Euromonitor’s Voice of the Industry survey, 2024}

The EU, for example, is at the forefront of these efforts, advancing multiple initiatives under its Green Deal umbrella. Its Deforestation Regulation (EUDR) requires deforestation-free certification for commodities such as soy, coffee and palm oil by the end of 2025. Although these measures apply for goods coming to the EU only, they will have spillover impacts and reshape global supply chains. In 2025, some countries including developing nations will also enhance taxes and regulations on sugar, fat and salt content in food, as well as nutrition labelling. While stricter environmental and health regulations may increase costs in the short and medium terms, they also create long-term opportunities for sustainable and health-focused products, allowing premium pricing to help offset these expenses.

For more insights, read our full report: Economies and Consumers in 2025.