June 2025 Economic Update: Key Trends to Watch

On June 11, 2025, CBC Chief Financial Officer Mark Yoon delivered a comprehensive economic update covering key trends impacting businesses and consumers nationwide. His analysis offered insight into several economic shifts unfolding mid-year.

The U.S. economy experienced a slight contraction in Q1, with GDP declining by 0.2%, largely due to a surge in imports ahead of sweeping new tariffs introduced by the Trump administration. These tariffs have introduced fresh uncertainty into global trade, with retaliation from China and heightened costs expected to influence inflation in the months ahead.

While inflation is showing signs of moderating, core price pressures remain elevated, and the Federal Reserve is anticipated to begin cutting interest rates later this year—with four 0.25% reductions expected by the end of 2026.

Labor markets remain resilient, with hiring continuing and wages rising 3.9% year-over-year. However, unemployment has edged up and federal government job losses may lead to broader impacts across sectors. Consumer sentiment has rebounded, but spending is slowing, especially in retail and goods.

In the housing market, inventory is up, pricing pressure is easing, and mortgage rates remain historically high. First-time buyers have returned in greater numbers, yet sentiment around home buying remains near record lows.

Yoon concluded with a forward-looking forecast showing moderate GDP growth, a softening labor market, and a cautious tone from businesses across sectors.

Stay tuned for more updates from Commercial Bank of California as we continue to help businesses navigate changing economic conditions.

You can watch the recorded webinar below.