As the global economy stumbles under the weight of renewed trade tensions and inflationary pressure, investors are once again turning to Precious Metals as a hedge against growing uncertainty.

This week, the World Bank sharply downgraded its outlook for U.S. economic growth in 2025, citing “a substantial rise in trade barriers” and ongoing volatility in international markets. The new forecast pegs U.S. GDP growth at 1.4%, down from 2.3% earlier this year. That would mark a near-halving of last year’s performance, when the economy grew by 2.8%.

At the center of the storm is a familiar headline: trade war tensions reignited under President Donald Trump’s economic agenda, particularly with tariffs aimed at Chinese imports and select European goods. Although Trump rolled back many of the highest tariffs to a flat 10%, key items—including automobile parts and goods from China—remain taxed as high as 30%.

“Without a swift course correction, the harm to living standards could be deep,” warned Indermit Gill, Chief Economist at the World Bank, in the group’s Global Economic Prospects report. He emphasized that the chances of a “soft landing”—lowering inflation without tipping into recession—are growing more remote.

A Bleak Global Picture

It isn’t just the United States feeling the impact.

The World Bank also downgraded global growth projections from 2.7% to 2.3%, citing reduced trade volume, weakening consumer demand, and policy uncertainty across multiple continents. The OECD echoed this sentiment last week, warning that protectionist policies are pushing inflation higher and growth lower across its 38-member nations.

According to the OECD’s updated outlook:

• U.S. GDP is expected to slow to 2.9% in 2025 from 3.3% the previous year.

• Inflation will likely remain elevated, stalling any potential Fed rate cuts until 2026.

• If inflation expectations become “de-anchored,” the Fed may be forced to raise interest rates again—an outcome few investors are currently pricing in.

This double threat of slow growth and persistent inflation—commonly known as stagflation—has created an atmosphere of uncertainty across financial markets, pressuring equities and making traditional “safe” investments increasingly volatile.

The Case for Precious Metals in a Trade War Economy

Amid these warnings, one sector is regaining attention from long-term investors: Precious Metals.

During periods of economic stagnation, rising inflation, and geopolitical tension, assets like gold and silver have historically served as a store of value and a hedge against fiat currency risk.

As investors look to preserve purchasing power and reduce exposure to volatile equities and inflation-prone cash, diversifying into Precious Metals has become not just a defensive move—but a strategic one.

Here’s why:

• Gold tends to outperform during rate-hike cycles, as real returns on stocks and bonds compress.

• Silver, while more volatile, often benefits from industrial demand and safe-haven buying at the same time.

• Physical metals like coins and bullion are immune to bank defaults, monetary policy missteps, or currency devaluation.

Meanwhile, Gold IRA rollovers—retirement accounts backed by physical gold or silver—are surging in popularity, especially among those looking to hedge long-term against systemic risk.

Consumer Pain Adds Fuel to Inflation Fears

The consequences of this economic slide aren’t abstract. They’re already being felt at the register.

Major retailers such as Walmart, General Mills, and Microsoft have begun layoffs and price increases. The cost of vehicles has surged, while food prices have climbed due to retaliatory tariffs placed on U.S. exports.

And despite political messaging about “temporary inflation,” the global consensus appears to be shifting toward the idea that inflation is structural, not transitory—especially when fueled by protectionist trade policies that raise import costs and disrupt supply chains.

Looking Ahead: Why Diversification Matters Now More Than Ever

Economists from both the World Bank and OECD are signaling caution, warning that the world has entered a phase of economic “turbulence” with few safe harbors.

In response, investors are increasingly focused on diversification, moving out of overexposed tech-heavy portfolios and cash positions that lose value with every uptick in CPI.

Precious Metals, historically a cornerstone of asset protection during times of global instability, are seeing renewed interest—not just from large institutions, but from everyday investors, retirees, and small business owners alike.

Speak to a Specialist Today

If you’re concerned about the direction of the economy, inflation, or how trade wars may impact your long-term financial security, now is the time to explore diversification strategies.

At GoldenCrest Metals, our specialists help investors protect their portfolios with tangible, IRS-approved Precious Metals, including Gold IRAs and direct delivery options.

Contact a GoldenCrest Metals Specialist today to learn how you can take control of your financial future with a personalized plan tailored to your goals and risk tolerance.