Fitch Ratings predicts a potential economic slowdown due to tariffs and inflation, with significant implications for global markets. Brian Coulton, the chief economist at Fitch Ratings, warns that escalating trade tensions could significantly impact growth as early as 2026. The analysis highlights how tariffs might hinder economic expansion by increasing costs for businesses and consumers. The potential decline in US and China’s GDP is estimated to be a full percentage point, with global trade impacted by rising pressures from tariffs. Fitch predicts that global economies will experience around a one-point reduction in growth due to the impact of trade tensions as early as 2026. This slowdown comes amid ongoing inflationary pressures which could negatively impact consumer purchasing power and potentially lead to economic instability. The International Monetary Fund (IMF) has adjusted its growth forecasts for major economies downwards, reflecting concerns over the effects of tariffs on global trade.