Trade Policy/Protectionism
Our Global Investment strategists offered their initial thoughts on the nascent US trade war with its allies, with a few longer-term takeaways. President Trump’s decision to delay Mexico tariffs on Monday highlights the uncertainty surrounding trade…
President Trump shot the opening salvo of his second trade war, announcing 25% tariffs on Canada and Mexico, with a more modest 10% on China and Canadian energy. Both countries retaliated with tariffs and non-tariff measures. Financial markets initially sold…
Our Geopolitical Strategy team modeled several of the Trump administration’s most disruptive policies in a simple game theory framework. The Trump administration’s policies have created a complex web of trade and foreign negotiations, increasing…
Simple games allow us to model several of the Trump administration’s most disruptive policies in 2025. We find that markets face an increase in volatility as Congress expands the budget, Trump implements tariffs on the world, China retaliates, and Taiwan tensions persist. A ceasefire in Ukraine is a marginally positive outcome for Europe, although it is not a long-term peace treaty.
Our China Investment Strategy team explored how the costs of higher tariffs might be distributed among foreign suppliers, US importers, and consumers. The inflationary impact of new US tariffs is likely to remain modest unless President Trump imposes…
The January ZEW index for Germany missed estimates, with expectations falling to 10.3 from 15.7 in December. However, the euro area level index ticked up to 18 from 17 a month prior. Measures of current conditions also rose. The lack of momentum for…
The December Canadian CPI was roughly in line with estimates, with headline inflation ticking down to 1.8% y/y from 1.9% in November. The BoC’s core inflation measures, median and trim, also decreased from 2.6% to 2.4% and 2.5%,…
We look at President Trump’s first mandate for lessons on how markets would likely react to different policies. On the fiscal front, the 2017 Tax Cuts and Jobs Act (TCJA) was the first pro-cyclical stimulus in decades. Markets pushed back, as the early 2018…
President Trump’s inaugural speech outlined his second term agenda. The theme was that the US will become “far more exceptional” than it already is. Trump pledged to reverse America’s decline, rebalance the justice system, streamline government, protect…
China’s December trade data was positive, with exports in USD terms rebounding to 10.7% y/y from 6.7% in November, and imports rebounding to 1.0% from -3.9%. Taken at face value, the numbers are positive for both the Chinese and global economies. However, our…