Recession Fears Grow: 62% of US CEOs Blame Tariffs, Trade Policy

A growing number of top US executives are bracing for an economic downturn within the next six months, driven by escalating uncertainty surrounding US trade policy and tariffs. In April, 62% of over 300 CEOs surveyed by Chief Executive anticipated a recession or economic slowdown, up from 48% in March.

The survey also revealed that about three-quarters of CEOs believe tariffs will negatively impact their businesses in 2025, with roughly two-thirds opposing President Donald Trump’s proposed levies. An index tracking CEO sentiment on current business conditions dropped 9% in April, hitting its lowest level since early 2020. Over 80% of CEOs expect rising costs this year, with nearly half anticipating double-digit expense increases. Just 37% predict profit growth, a steep decline from 76% in January.

BlackRock CEO Larry Fink cautioned that the US economy “may have already weakened to the point of growth coming in negative,” adding, “I think we are very close to, if not already in, a recession.” Similarly, JPMorgan Chase CEO Jamie Dimon warned that S&P 500 earnings estimates might decline due to tariff uncertainty.

Ray Dalio, founder, Bridgewater Associates, shared these concerns during an appearance on NBC’s Meet the Press. “We are at a critical decision-making point and very close to a recession,” he said. “I am worried about something worse than a recession if this is not handled properly.” Dalio emphasized the disruptive effects of unilateral trade policies, mounting US debt, and geopolitical shifts. While acknowledging the administration’s valid concerns about trade, he criticized its approach, citing global market volatility and the risk of systemic disruption.

On Wednesday, President Trump announced a 90-day pause on “reciprocal tariffs” but reaffirmed a 10% baseline duty and tariffs of up to 145% on Chinese goods. US Customs and Border Protection subsequently issued a temporary exemption on consumer electronics, including smartphones and semiconductors. Commerce Secretary Howard Lutnick clarified that these exemptions are not permanent.

Dalio also warned of potential instability in the US bond market if federal deficits are not addressed. He called on Congress to reduce the deficit to 3% of GDP and urged the United States and China to negotiate a "win-win" trade agreement that includes debt stabilization and a stronger yuan.

Market responses to the uncertainty are already evident. According to the Institute of International Finance (IIF), non-resident capital outflows from emerging markets totaled US$17.1 billion in March, reversing inflows of US$51.3 billion during the first two months of the year. Equity markets accounted for US$12.4 billion in outflows, while debt markets saw net losses of US$4.8 billion.

The IIF report, Positioning Pains and Preemptive Pullbacks, attributed the withdrawals to investor anxiety over a looming shift in US trade policy. “By the end of March, investors’ positions reflected growing concern about a new phase of trade fragmentation,” the report noted.

While some resilience was observed in countries like Mexico and Brazil—where high real interest rates and commodity exposure drew limited investor interest—these factors were insufficient to offset broader risk aversion. Analysts cautioned that although the structural appeal of emerging market debt remains intact, with high real yields and improved fiscal profiles, “the carry trade cushion is not enough to compensate for all sources of external stress.”