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February 4, 2025

Analysts Warn Trump’s Tariffs Could Induce U.S. Stagflation

President Donald Trump’s recent tariffs may hinder U.S. economic growth and fuel inflationary pressures, according to analysts at Evercore ISI.

Key Developments to Note

Over the weekend, Trump enforced a 25% tariff on imports from both Canada and Mexico, plus a 10% duty on Canadian energy products and Chinese goods.

Market & Economic Impact Overview

๐Ÿ”ป GDP Impact: Analysts predict a potential over 0.4% impact on GDP.
๐Ÿ”บ Inflationary Pressure: The tariffs may push prices up by 0.4% or more.
โš ๏ธ Stagflation Risk: Weak growth combined with rising inflation could strain markets.

Trade Conflict Escalation

  • Canada and Mexico have announced retaliatory tariffs against U.S. goods.
  • China intends to challenge the tariffs at the WTO and may implement further countermeasures.
  • No clear benchmarks have been designated by Trump’s administration for lifting these tariffs.

Future Considerations

Market participants are focused on how corporate earnings and valuations may react. Leverage tools like:

  • Earnings Calendar API โ€“ Monitor corporate reactions to tariffs.
  • Sector P/E Ratio API โ€“ Identify sectors sensitive to inflation.

As uncertainties rise, investors should prepare for potential market fluctuations in the near future.

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