Monthly Economic Outlook

Economic forecast: July 2025 trends and analysis

Macroeconomic insights and outlook from the U.S. Bank Economics Research Group to help guide your business strategy

July 2025


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Exterior view of the U.S. Capitol building with dark clouds

Key takeaways: Waiting for the fireworks

  • We still expect the Fed to engineer a soft landing for the U.S. economy, but with a much bumpier ride. While we expect the U.S.-China truce to be extended, relaunching extreme tit-for-tat tariffs threaten this happy ending.

  • The spring homebuying season has proven sluggish under the heavy weights of strained affordability and fresh economic uncertainty. 

  • Job growth continues to moderate in June, but at relatively healthy levels and not enough to move the Fed from its ‘wait-and-see’ approach. A still-low unemployment rate and soft jobless claims indicate no new slack in the labor market. 

  • Increased immigration enforcement is have a chilling effect on labor force participation. It constrains potential employment gains, household spending and ultimately economic growth. 

Macroeconomics forecast at a glance

Produced by the U.S. Bank Economics Research Group, our in-depth economic forecast examines the trends and economic indicators shaping business decisions this year and into the future.

July 2025 Report

Download the entire monthly report from the U.S. Bank Economics Research Group.

View full report (PDF)

Sources: U.S. Bank Economics, Bloomberg, Yale Budget Lab, U.S. Bank Economics calculation

 

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Disclosures

The views expressed in this commentary represent the opinion of the author and do not necessarily reflect the official policy or position of U.S. Bank. The views are intended for informational use only and are not exhaustive or conclusive. The views are subject to change at any time based on economic or other conditions and are current as of the date indicated on the materials. It is not intended to be a forecast of future events or guarantee of future results. It is not intended to provide specific advice. It is issued without regard to any particular objective or the financial situation of any particular individual. It is not to be construed as an offering of securities or recommendation to invest. It is not for use as a primary basis of investment decisions. It is not to be construed to meet the needs of any particular investor. It is not a representation or solicitation or offer for the purchase or sale of any particular product or service. Investors should consult with their investment professional for advice concerning their particular situation. The factual information provided has been obtained from sources believed to be reliable, but is not guaranteed as to accuracy or completeness. U.S. Bank is not affiliated or associated with any organizations mentioned. U.S. Bank and its representatives do not provide tax or legal advice. Each individual's tax and financial situation is unique. You should consult your tax and/or legal advisor for advice and information concerning your particular situation.