The World Bank sharply cut its global economic growth projections Tuesday, citing disruption from trade uncertainty in particular.

It now expects the global economy to expand by 2.3% in 2025, down from an earlier forecast of 2.7%.

“This would mark the slowest rate of global growth since 2008, aside from outright global recessions,” the Bank said in its Global Economic Prospects report.

Trade uncertainty, especially, has weighed on the outlook, the World Bank suggested.

“International discord — about trade, in particular — has upended many of the policy certainties that helped shrink extreme poverty and expand prosperity after the end of World War II,” Indermit Gill, senior vice president and chief economist of The World Bank Group, said in the report.

It also cut its 2025 growth forecast for the U.S. by 0.9 percentage points to 1.4%, and reduced its euro area GDP expectations by 0.3 percentage points to 0.7%.

The Bank noted that an escalation of trade tensions could push growth even lower, but the picture could improve if major economies strike lasting trade agreements.

“Our analysis suggests that if today’s trade disputes were resolved with agreements that halve tariffs relative to their levels in late May, 2025, global growth could be stronger by about 0.2 percentage point on average over the course of 2025 and 2026,” Gill said.

The U.S. and many of its trading partners are currently in negotiations after U.S. President Donald Trump imposed steep tariffs on numerous countries in April. This week, for example, the U.S. and China are meeting in London after the two countries agreed to temporarily reduce levies following talks in May.

Negotiations are also still ongoing between the U.S. and European Union with less than a month to go before previously announced tariffs are set to come into full force.

In cutting its global growth expectation, the World Bank follows various other bodies, including the Organisation for Economic Co-operation and Development, which also cited the fallout from trade and tariff-related uncertainty as the key factor.

The OECD said earlier this month that it was expecting global growth to slow to 2.9% in 2025, also caveating its forecast with the potential for future tariff developments. It had previously forecast global growth of 3.1% this year.

Bulgaria is set to become the 21st member of the euro zone after receiving sign off from the European Commission and European Central Bank last week — but not everyone is convinced the move is a good idea.

Bulgaria’s Prime Minister Rosen Zhelyazkov, member of the center-right GERB party, has made joining the euro zone a priority, arguing that it would boost economic stability and growth.

However, fears of higher prices and a loss of independence have stoked nationalist-party fueled protests against the country’s euro ascension. A recent European Union survey showed that half of Bulgaria’s population is against adopting the euro.

Economists and experts weighed in on the potential risks to Bulgaria joining the euro, outlining what the eastern European country could lose and gain from the move.

The second key concern is what giving up Bulgaria’s currency, the lev, will mean for the country’s independence and sovereignty — ideals for which it has become symbolic according to Andrius Tursa, central and eastern Europe advisor at Teneo.

“Its replacement with the euro may be perceived by parts of the population as a loss of national control,” he told CNBC. In addition there are concerns about relinquishing control of monetary policy as countries in the euro zone are subject to decisions by the ECB, Tursa added.

The Bulgarian National Bank (BNB) would for example no longer solely be responsible for setting the country’s interest rates based only on how its individual economy is developing.

However, “eurozone countries benefit from lower interest rates due to the credibility of the ECB and reduced currency risk,” Tursa pointed out. Lower interest rates typically benefit borrowers as loans and mortgages become more affordable.

Many of Bulgaria’s key trading partners are in the EU, with most of its exports going to members of the 27-state bloc in 2023 according to data from the country’s statistics office. Key sectors include machinery and transport equipment, manufactured goods and food.

Tourism has meanwhile become a major contributor to the economy as Bulgaria positions itself as both a summer and winter destination. Over 13 million foreigners visited the country in 2024, official statistics showed.

“Bulgaria’s accession to the eurozone would facilitate trade and tourism flows with other eurozone countries by eliminating the costs and burden associated with currency conversion,” Tursa said, adding that this would be particularly important due to Bulgaria’s strong integration into EU supply chains.

Business leaders are walking back recessionary expectations for the U.S. that initially spiked in the aftermath of President Donald Trump’s tariff announcement, according to data released Monday.

Less than 30% of CEOs forecast either a mild or severe recession over the next six months, per Chief Executive Group’s survey of more than 270 taken last week. That’s down from 46% who said the same in May and 62% in April.

The share of CEOs polled this month who said they expect some level of growth in the U.S. economy also shot up above 40%. That’s nearly double from the 23% who gave the same prediction in April.

Expectations for flat economic growth have surged in recent months, rising above 30% from 15% in April. That comes as some market participants question if “stagflation” — a term used to described an environment with stagnating economic growth and sticky inflation — could be on the horizon.

Chief Executive’s latest data reflects a shifting outlook among corporate America’s leaders as they follow the evolving policy around Trump’s tariffs. Many large companies have left their earnings outlooks unchanged, citing the uncertainty around what the president’s final trade policy will and will not include.

Trump sent U.S. financial markets spiraling in April after first unveiling his plan for broad and steep levies on many countries and territories, which market participants worried would hamper consumer spending. He placed many of those duties on pause shortly after, which helped the market recoup much of its losses.

The White House has been negotiating deals with countries during this reprieve, which is set to expire early next month. The Trump administration announced an agreement with the United Kingdom and is holding talks with China in London on Monday.

“We do recognize that sweeping changes in global trade policy could contribute to broader macroeconomic volatility, including the potential to tip certain regions into a recession,” said Michael DeVeau, finance chief at International Flavors & Fragrances, on the company’s earnings call last month.

Firms have raised alarm that tariffs could hit their bottom lines and that they will need to pass down higher costs by raising prices. Some also said rising fears of a recession because of the levies have pushed consumers to tighten their belts financially.

The University of Michigan’s closely followed consumer sentiment index has plunged near its lowest levels on record as the tariff announcements rattled everyday Americans.

However, a New York Federal Reserve survey released Monday paints a brighter picture. The data showed that the average consumer is growing less concerned about inflation after Trump walked back some of his most severe trade plans.

“From the macro, the worst concerns, I think, have passed,” Home Depot CEO Edward Decker said last month. “We’ve gone from a dynamic of where we were going to have a near certain recession and stock market correction in early April, to where today stock markets fully recovered (and) recession expectations are way down in the past month.”