Intrum anticipates scenarios and risks for the national and European economy in 2025

Intrum has just published the 13th edition of its “Economy in Focus” report, which analyses macroeconomic trends for 2025. The conclusions indicate that interest rate cuts will continue, but at different paces; budgetary tightening could slow down the economic recovery; and geopolitical risks threaten stability.

The report highlights the challenges and opportunities that will mark the current year and their impact on the European economy.

The analysis, conducted by Intrum senior economist Anna Zabrodzka-Averianov, points to weak economic growth, driven mainly by household consumption, but conditioned by the international situation. Persistent inflation, slowing economic growth and global geopolitical uncertainty are highlighted as determining variables for economic performance in Portugal and Europe.

The debt collections company believes that the global economy is facing a new cycle, in which the path of monetary policy seems relatively predictable, but the economic recovery remains shrouded in uncertainty. The continuation of the European Central Bank's interest rate easing, which began in 2024, could stimulate consumption and investment, but the impact of this move will depend on the global macroeconomic context.

“Among the main challenges identified by the report are geopolitical uncertainties, which remain a critical variable in the global economic equation. The return of Donald Trump to the US presidency, political instability in key countries such as Germany and France, and ongoing conflicts in Ukraine and the Middle East are some of the factors that could significantly influence markets and investor confidence,” Intrum considers.

According to Anna Zabrodzka-Averianov, “Although a slow recovery of the global economy seems certain by 2025, geopolitical uncertainties and economic challenges continue to cloud the outlook, potentially giving rise to both significant risks and growth opportunities.”

Weak growth and interest rate cuts

Intrum cites IMF projections that say the eurozone economy is expected to grow 1.2% in 2025, compared to the 0.8% estimated for 2024.

Growth, which remains modest, will be constrained by structural challenges such as an ageing population and weak productivity growth. In addition, European governments face the dilemma of consolidating public finances weakened by the economic stimulus of recent years, limiting the scope for expansionary fiscal policies.

The fiscal consolidation expected for 2025 comes as a response to the strong economic stimulus provided by European governments in recent years, especially during and after the pandemic and the subsequent cost of living crisis.

With public finances weakened, governments will be forced to cut spending in the near future to avoid losing investor confidence in their ability to maintain fiscal stability. Goldman Sachs predicts that this phase of fiscal tightening could last until 2027.

Two possible scenarios for 2025

The “Economy in Focus” report presents two distinct scenarios for the development of the global economy over the year. A positive scenario consists of consumption-led growth and controlled inflation; a reduction in geopolitical tensions and stabilization of trade relations; effective management of interest rates, allowing the recovery of consumption and investment; improvement of supply chains and stability of energy markets; and technological innovation driving productivity and sustainable growth.

The negative scenario incorporates persistent inflation and stagnant growth, but also an increase in geopolitical tensions, worsening conflicts and impacts on trade flows. It also includes protectionist policies that undermine global cooperation; failure of central banks to contain inflation by limiting interest rate cuts; and rising unemployment and economic difficulties in strategic sectors.

The report by the company that buys unpaid debts considers that Donald Trump's return to the White House could redefine global trade relations, with a potential increase in protectionism, particularly through the imposition of tariffs on Chinese imports.

The study highlights the risks of a new trade war, which could destabilise supply chains and hurt global economic growth. In addition, political instability in Germany and France threatens the cohesion of the European Union, while conflicts in Ukraine and the Middle East continue to cause shocks to energy markets and fuel economic uncertainty.

The year 2025 will be decisive for the evolution of the global economy, with opportunities for economic recovery, but also significant risks, concludes Intrum.

“As central banks seek to balance monetary easing with controlling inflation, businesses and investors will need to be prepared to respond quickly to changes in the economic and geopolitical environment,” the firm said.

For Luís Salvaterra, General Director of Intrum in Portugal, he argues that “the challenges and opportunities presented in Intrum's most recent 'Economy in Focus' report have a direct impact on the Portuguese economy”.

“Despite the slight acceleration in growth expected for the eurozone in 2025, Portugal continues to face structural challenges, such as low productivity, which remains at 74% compared to the European average, and an ageing population, which may limit economic dynamism. On the other hand, the evolution of inflation and monetary policy will be decisive for the purchasing power of families and the competitiveness of national companies. At Intrum, we continue to monitor the impact of these dynamics on the Portuguese business sector, especially on the ability of companies to manage credit risk and maintain their liquidity”, says the manager of hard-to-recover loans.