Reserve

2024

Donald Trump

A Donald Trump victory in the 2024 U.S. presidential election could shake the global economy in many ways. If he wins, expect changes in trade, economic growth, and financial stability.
Trump’s approach to trade could lead to big changes. He wants to slap a 10% tariff on all U.S. imports, up from the current 2%. This means everything coming into the U.S. would cost more.&nbsp;
The tariffs might cause other countries to retaliate with their own tariffs, leading to trade wars. Remember the last time Trump did this? It strained relations with China and disrupted global supply chains.
<figure id="attachment_558088" aria-describedby="caption-attachment-558088" style="width: 100%" class="wp-caption alignnone"><img fetchpriority="high" decoding="async" class="wp-image-558088 size-full" src="https://www.cryptopolitan.com/wp-content/uploads/2024/07/If-Joe-Biden-bails-on-the-race-whats-next.jpeg" alt="What will a Donald Trump win mean for the global economy?" width="1160" height="773" srcset="https://www.cryptopolitan.com/wp-content/uploads/2024/07/If-Joe-Biden-bails-on-the-race-whats-next.jpeg 1160w, https://www.cryptopolitan.com/wp-content/uploads/2024/07/If-Joe-Biden-bails-on-the-race-whats-next-300x200.jpeg 300w, https://www.cryptopolitan.com/wp-content/uploads/2024/07/If-Joe-Biden-bails-on-the-race-whats-next-768x512.jpeg 768w" sizes="(max-width: 1160px) 100vw, 1160px">
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 President Joseph Robinette Biden Jr. Credits: Evan Vucci/AP Photo
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Higher tariffs would also lead to higher prices for imported goods. This could slow down consumer spending and hurt the economy.&nbsp;
The reduction in global trade could disrupt international supply chains and lead to job losses in export-driven industries.
<h3 id="b-economic-growth-and-stability-b">Economic growth and stability</h3>
Trump’s economic policies could have some mixed effects on growth. On the one hand, tax cuts and increased spending on defense and entitlements could boost U.S. growth in the short term.&nbsp;
But on the other, these policies could also increase the national debt and budget deficits, creating long-term economic instability.
The International Monetary Fund (IMF) has warned that drastic changes in economic policy due to elections could cause damaging cross-border effects.&nbsp;
<figure id="attachment_556304" aria-describedby="caption-attachment-556304" style="width: 100%" class="wp-caption alignnone"><img decoding="async" class="wp-image-556304 size-full" src="https://www.cryptopolitan.com/wp-content/uploads/2024/07/UK-growth-outlook-upgraded-by-IMF-ECB-weighs-September-rate-cut.webp" alt="What will a Donald Trump win mean for the global economy?" width="1200" height="743" srcset="https://www.cryptopolitan.com/wp-content/uploads/2024/07/UK-growth-outlook-upgraded-by-IMF-ECB-weighs-September-rate-cut.webp 1200w, https://www.cryptopolitan.com/wp-content/uploads/2024/07/UK-growth-outlook-upgraded-by-IMF-ECB-weighs-September-rate-cut-300x186.webp 300w, https://www.cryptopolitan.com/wp-content/uploads/2024/07/UK-growth-outlook-upgraded-by-IMF-ECB-weighs-September-rate-cut-768x476.webp 768w" sizes="(max-width: 1200px) 100vw, 1200px">
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 Credits: Getty Images
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A Trump presidency might slow global growth due to increased trade tensions and policy uncertainty.&nbsp;<a href="https://www.cnbc.com/2024/07/15/what-a-trump-presidency-could-mean-for-europes-economy.html" rel="noopener noreferrer nofollow" target="_blank">According</a> to Goldman Sachs, Trump’s re-election could reduce the Eurozone’s GDP by 1% and slightly increase inflation by 0.1%.
<h3 id="b-inflation-and-monetary-policy-b">Inflation and monetary policy</h3>
Trump’s policies could also lead to higher inflation. The combination of tariffs, fiscal stimulus, and supply chain disruptions might push inflation rates up in the U.S. and worldwide.&nbsp;
There are concerns that Trump might replace the Federal Reserve Chair with someone more aligned with his views, which would threaten the Fed’s independence.&nbsp;
Higher inflation might force central banks to keep interest rates high, affecting global borrowing costs and economic growth.
<img decoding="async" class="alignnone wp-image-539294 size-full" src="https://www.cryptopolitan.com/wp-content/uploads/2024/06/DALL·E-2024-06-11-18.59.30-A-compelling-landscape-image-for-an-article-about-the-Federal-Reserve-being-heavily-urged-to-cut-interest-rates.-The-image-should-depict-a-group-of-pe.webp" alt="What will a Donald Trump win mean for the global economy?" width="1792" height="1024" srcset="https://www.cryptopolitan.com/wp-content/uploads/2024/06/DALL·E-2024-06-11-18.59.30-A-compelling-landscape-image-for-an-article-about-the-Federal-Reserve-being-heavily-urged-to-cut-interest-rates.-The-image-should-depict-a-group-of-pe.webp 1792w, https://www.cryptopolitan.com/wp-content/uploads/2024/06/DALL·E-2024-06-11-18.59.30-A-compelling-landscape-image-for-an-article-about-the-Federal-Reserve-being-heavily-urged-to-cut-interest-rates.-The-image-should-depict-a-group-of-pe-300x171.webp 300w, https://www.cryptopolitan.com/wp-content/uploads/2024/06/DALL·E-2024-06-11-18.59.30-A-compelling-landscape-image-for-an-article-about-the-Federal-Reserve-being-heavily-urged-to-cut-interest-rates.-The-image-should-depict-a-group-of-pe-1200x686.webp 1200w, https://www.cryptopolitan.com/wp-content/uploads/2024/06/DALL·E-2024-06-11-18.59.30-A-compelling-landscape-image-for-an-article-about-the-Federal-Reserve-being-heavily-urged-to-cut-interest-rates.-The-image-should-depict-a-group-of-pe-768x439.webp 768w, https://www.cryptopolitan.com/wp-content/uploads/2024/06/DALL·E-2024-06-11-18.59.30-A-compelling-landscape-image-for-an-article-about-the-Federal-Reserve-being-heavily-urged-to-cut-interest-rates.-The-image-should-depict-a-group-of-pe-1536x878.webp 1536w" sizes="(max-width: 1792px) 100vw, 1792px">
Trump has said he prefers a weaker dollar to boost U.S. exports. But, during global instability, the dollar often strengthens as a safe-haven currency.&nbsp;
His policies could push countries to reduce their reliance on the dollar in international transactions.
A Trump presidency could heighten geopolitical tensions, impacting the economy. U.S.-China relations might worsen, affecting trade, technology transfer, and investments.&nbsp;
<h3 id="b-financial-markets-and-investor-sentiment-b">Financial markets and investor sentiment</h3>
Trump’s policies could affect financial markets big time. The uncertainty surrounding his policies could lead to increased market volatility.&nbsp;Increased deficit spending could pressure bond yields, leading to higher global borrowing costs.
Trump has also promised to end the “persecution” of the crypto community, pledging to sack the SEC chair and stop the crackdown on Bitcoin.
<figure id="attachment_557880" aria-describedby="caption-attachment-557880" style="width: 100%" class="wp-caption alignnone"><img loading="lazy" decoding="async" class="wp-image-557880 size-full" src="https://www.cryptopolitan.com/wp-content/uploads/2024/07/5-spot-Ethereum-ETFs-cleared-for-July-23rd-launch-by-SEC.jpeg" alt="What will a Donald Trump win mean for the global economy?" width="929" height="523" srcset="https://www.cryptopolitan.com/wp-content/uploads/2024/07/5-spot-Ethereum-ETFs-cleared-for-July-23rd-launch-by-SEC.jpeg 929w, https://www.cryptopolitan.com/wp-content/uploads/2024/07/5-spot-Ethereum-ETFs-cleared-for-July-23rd-launch-by-SEC-300x169.jpeg 300w, https://www.cryptopolitan.com/wp-content/uploads/2024/07/5-spot-Ethereum-ETFs-cleared-for-July-23rd-launch-by-SEC-768x432.jpeg 768w" sizes="(max-width: 929px) 100vw, 929px">
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 Gary S. Gensler. Credits: Getty Images
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He criticized the Biden administration’s oversight of cryptocurrency, calling it “repression.” Trump could shake up the crypto market and attract support from crypto enthusiasts.
In a recent interview, he said that he would let Federal Reserve Chair Jay Powell finish his term if he was doing the right thing, though there are reports that his team is drafting proposals to erode the Fed’s independence.
<figure id="attachment_554794" aria-describedby="caption-attachment-554794" style="width: 100%" class="wp-caption alignnone"><img loading="lazy" decoding="async" class="wp-image-554794 size-full" src="https://www.cryptopolitan.com/wp-content/uploads/2024/07/Federal-Reserve-uses-labor-market-to-decide-on-rate-cuts.webp" alt="What will a Donald Trump win mean for the global economy?" width="1400" height="787" srcset="https://www.cryptopolitan.com/wp-content/uploads/2024/07/Federal-Reserve-uses-labor-market-to-decide-on-rate-cuts.webp 1400w, https://www.cryptopolitan.com/wp-content/uploads/2024/07/Federal-Reserve-uses-labor-market-to-decide-on-rate-cuts-300x169.webp 300w, https://www.cryptopolitan.com/wp-content/uploads/2024/07/Federal-Reserve-uses-labor-market-to-decide-on-rate-cuts-1200x675.webp 1200w, https://www.cryptopolitan.com/wp-content/uploads/2024/07/Federal-Reserve-uses-labor-market-to-decide-on-rate-cuts-768x432.webp 768w" sizes="(max-width: 1400px) 100vw, 1400px">
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 Federal Reserve Chair Jerome Powell. Credits: CNBC
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While tough talk on inflation might appeal to voters, messing with central bank independence could risk monetary stability and credibility.

What will a Donald Trump win mean for the global economy?

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