Is a reflation problem brewing for the Federal Reserve in 2025? A TMC Research note highlights the potential factors aligning for 2025 that may trigger a course correction for monetary policy: “In the context of potentially reflationary factors brewing for 2025 from various sources, the outlook for ramping up money supply growth could be ill-timed for the central bank’s plans to manage inflation pressures.”

President-elect Trump plans to impose new tariffs on three key US trading partners: China, Mexico and Canada, he wrote on his social media platform Truth Social. Mexico is the largest trading partner of the US, followed by Canada and China, according to data as of September.

Texas factory activity was flat in November, according to the Dallas Fed Manufacturing Index. ” production index, a key measure of state manufacturing conditions, slipped to a near-zero reading after rising to 14.6 last month,” the bank reports.

GOP plans to extend the 2017 tax cuts is estimated to increase the US deficit by $5 trillion, according to the nonpartisan Congressional Budget Office. CNBC reports: “House Majority Leader Steve Scalise, R-La., criticized the CBO, saying the agency doesn’t always use dynamic scoring, which would consider both the primary and secondary economic impacts.”

German business confidence fell more than expected in November, deepening the worrisome outlook for the country’s economy, which is the weakest performer in the Group of Seven (G7) this year. Donald Trump’s return to the White House suggests Germany’s export-oriented economy will remain challenged in the near term.

US economic activity slipped in October to its weakest reading since April, according to the monthly print of the Chicago Fed National Activity Index. The 3-month average also dipped, but remains well above the level that signals recessionary conditions.