2025 midyear policy outlook

We knew that the first 100 days of the second Trump administration would be a roller coaster, but no one could have anticipated how steep the dives or how hard the turns would be as he implemented an “everything, everywhere, all at once approach.”

In his first 100 days in office, President Trump signed 143 executive orders, more than any other president has signed in his first 100 days. (Many of these are facing legal challenges.) To compare, Trump signed just 33 executive orders in the first 100 days of his first term.

Perhaps the most economically significant of the executive orders are those focused on trade and tariffs. Trump wasted no time implementing an “America First Trade Policy” agenda, punctuated with his April 2 “Liberation Day” tariffs (many of which were quickly paused). Since then, progress has emerged on talks with some global trade partners. As new trade deals are announced in the coming days, weeks, and months, it will be the ongoing negotiations to turn these frameworks into finalized bilateral trade agreements that are expected to take many months, and some cases years, to work through.

And, with midterm elections looming in November 2026, political analysts are trying to understand the risk to the Republican majorities in Congress as polls are proving that the tariffs have been generally unpopular with the American public.

Other issues to watch

Of course, tariffs aren’t the only issue to watch in the second half of 2025.

• While the extension and expansion of Trump’s 2017 tax reform is an important step in this administration’s agenda to grow the US economy, an ambitious deregulation agenda is expected to be a significant focus as we enter the second half of this year.
• As of late, the Trump administration, led by special envoy Steve Witkoff, is focused on nuclear talks in Iran. While his administration’s last attempt at talks in 2015 was not fruitful, this time around, Trump has signalled both renewed confidence in the current negotiations and a stern warning of future attacks if the talks break down.
• With unified Republican control in Washington, there has been an immediate shift in the approach to financial regulation. In Congress, the House Financial Services Committee and Senate Banking Committee are working diligently on their agenda to expand capital access in the public and private markets and craft a functional regulatory framework for digital assets.

Global view

• United Kingdom. One of the UK government’s key objectives in the second half will be successfully concluding ‘reset’ negotiations with the European Union to reduce frictions in goods trade and build  linkages between UK and EU energy policies.
• European Union. The first formal discussions on the next EU budget will begin in the summer, prompting a likely long-running debate about the proportion that can be allocated to defense and security initiatives, as well as how the EU will begin to repay c.€800 billion of COVID-19 era debt.
• China. At the March 2025 National People’s Congress, China set its official budget deficit target at a record-high 4% of GDP, signalling a shift toward more aggressive fiscal support that aims to stabilize the economy amid declining tax revenues and external pressures.