Trump's Return: Economic and Geopolitical Outlook

Trump's Return: Economic and Geopolitical Outlook

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Trump's Return: Economic and Geopolitical Outlook

Analysis of the economic and geopolitical consequences of Donald Trump's return to power, focusing on the impacts on US and European economies.

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PoliticsInternational RelationsEconomyUs PoliticsTradeEconomic Growth
Berenberg BankFederal ReserveWhite HouseCongress
Donald TrumpHolger Schmieding
How might Trump's policies affect the Eurozone's economic growth?
The predicted increase in US domestic demand and a stronger dollar may partially offset the negative impacts of higher tariffs on the Eurozone's growth, although Germany is expected to experience a greater reduction in growth.
What are the geopolitical implications of Trump's return for European businesses?
The return of Donald Trump to the White House introduces significant geopolitical uncertainty, potentially leading to trade disputes and impacting European businesses; the extent of these impacts will depend on Trump's trade policies and potential escalations.
What is the predicted impact of Trump's return on US GDP growth in 2025 and 2026?
Trump's return to power is predicted to boost US GDP growth to 2.4% in 2025 and 2.1% in 2026, driven by tax cuts and deregulation, but potentially harming long-term fiscal sustainability due to higher tariffs and reduced immigration.
What is the anticipated effect on inflation and how might the Federal Reserve respond?
Trump's policies are expected to temporarily increase inflation due to added tariffs, while deregulation may alleviate some price pressures; the Federal Reserve is expected to adjust interest rates accordingly, cutting them later than otherwise anticipated.
What are the potential long-term risks to the US fiscal stability under a Trump administration?
Higher tariffs, retaliatory measures from other countries, labor shortages, and potential institutional damage from replacing competent officials with loyalists are all factors that could negatively affect the long-term fiscal health of the United States under a Trump presidency.