Politicians are often criticized for failing to enact campaign promises. In the case of the elected president Donald Trump’s return to the White Housethe market is becoming somewhat confident.
Trump’s economic policies they were successful with voters but drew more mixed reactions from analysts and economists. The winning candidate’s immigration and tariff proposals, in particular, raised questions about how they would work in practice.
But experts now know this the former President Donald Trump will be back in the Oval Officeagainst his Democratic rival, Vice President Kamala Harris. In the early hours of the morning, Trump was declared the winner of the 2024 race, winning 277 of the 270 seats needed for the role of commander-in-chief..
The markets were mixed this morning many analysts resisted hitching the wagon to one candidate or the other.
As economists solidified their views on another Trump administration, one thing became clear: the most pressing points of Trump’s tenure are certain not to materialize.
Before calling the election in favor of Trump, UBS chief economist Paul Donovan wrote. luck: “Markets look like campaign rhetoric (especially around deportations and tariffs) won’t quite translate into policy.
“The potential for market movements therefore, it depends on the emerging signals to know how dramatic these policies can be.
Trump’s tariff plans include a 10% tax on all goods imported into the US and a hefty 60% tax on imports from China.
The politician has made it clear that he also wants to impose the tax on some of America’s biggest trade and political allies, such as Europe, nations say pay a “high price”.
Trump also said his administration would conduct “the largest internal deportation operation in American history.”
in an interview Time magazineTrump said he plans to remove more than 11 million people by building migrant detention camps and deploying the US military along the border and across the country.
Hopeful in Europe
As European markets awoke to the news of Trump’s victory, analysts were eager to chart the spectrum of outcomes if the politician’s proposals came to fruition.
Analysts at Goldman Sachs he wrote in a note he saw luck “Renewed trade tensions (between the US and Europe) are likely to weigh heavily on growth.”
Assuming European nations would go along with Trump’s same 10% tariff, economists saw eurozone GDP falling by 1%: 0.7% in the UK, 1.1% in Germany, 1.1% in Sweden and 1% in Switzerland.
That said, Goldman said his basic expectation is for a more limited European tariff, including on $80 billion worth of auto-related imports, or 0.9% of EU exports.
“We again assume individual retaliation by the EU, but even then the economic effects of the tariffs will be limited,” the analysts continued.
at JPMorganAnalysts are also hearing that Trump’s policies will not be established as quickly as the politician could mention it.
Experts from America’s largest bank gathered politicians and economists – even Trump’s advisers – at the end of October IMF/MAutumn meetings of the World Bank. In a memo seen by Fortune, they wrote: “Trump advisers outlined a gradual introduction of tariffs to give corporations time to adjust operations and other countries time to reconsider and negotiate.
“Reciprocal tariffs were discussed, where U.S. goods abroad are disadvantaged relative to foreign goods entering the U.S., as opposed to an outright punitive tariff.”
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