The new tariffs imposed by US President Trump are likely to have significant consequences for the global economy. According to JPmorgan, the risk of a global recession increases strongly. US consumers would be particularly affected, for whom the tariffs de facto de facto a massive tax increase.
• JPMorgan: Trump-Zölle significantly increase risk of global recession
• Negative effects could be reinforced by counter -tariffs and other factors
• Analysts see huge tax increase for US consumers in new tariffs
US President Donald Trump’s most recent economic policy measures make internationally high waves. At the so -called “Liberation Day”, Trump announced a flat -rate import duties of ten percent on foreign products and additional tariffs against important trading partners, the amount of which varied depending on the country. This decision not only caused unrest among the trading partners, but also with leading financial houses. According to analysts of the US major bank JPmorgan, the risk of a global recession has increased drastically due to the new tariffs.
JPmorgan warns of episodes of the Trump-Zölle
In a recent research note entitled “Blood will flow”, the experts around JPMorgan chef economist Bruce Kasman write according to “Business Insider” that the complete implementation of the tariffs would represent a “considerable macroeconomic shock”. “Disruptive US politics was considered the greatest risk of global development all year round,” says the document. “The latest news encourages our fears because US trade policy has become significantly less business-friendly than expected.”
“The risk of recession in the global economy is increased to 60 percent this year, after 40 percent before,” said the team around Kasman. A scenario is also conceivable in which the rest of the world somehow struck through a US recession, but it is less likely. Instead, the effects of the customs shock could be reinforced by countermeasures, disorders of the supply chain and a decline in mood in the economy. The great risk is also that the US policy on the offer side is causing permanent damage.
Trump-Zölle could mean the greatest tax increase since 1968
According to the analysts, the new tariffs would like a tax increase for US households and companies on the purchase of imported goods, as they significantly more expensive. Trump’s measures therefore affect not only the global supply chains, but also directly the American consumers. “If it stays that way, this year’s customs increase would be around 22 percentage points the largest tax increase in the United States since 1968,” says JPMorgan. As “Fortune” writes, the higher tariffs for private households in the USA should lead to an additional load of around $ 700 billion. In relation to the size of the US economy, this de facto tax increase would be roughly as painful as Lyndon B. Johnson’s “Revenue Act” to finance the Vietnam War at the time.
Economy in front of the tipping point
According to “Reuters”, the analysts of JPmorgan are currently the most pessimistic experts with a risk of recession of 60 percent. However, other institutes have also screwed up their forecast for the probability of a US recession since the “Liberation Day”. For example, Goldman Sachs now puts the risk of 35 percent – after 20 percent – and at S&P Global, the probability of recession previously increased from 25 percent to 30 to 35 percent.
According to “Business Insider”, the JPMorgan experts also believe that despite all pessimism, that a global recession is still “not a decided thing”. “Apart from the fact that the political measures may be changed in the coming weeks, we continue to emphasize that US and global expansion is on solid soil and should withstand a moderate shock,” says the research note. In addition, money policy loosening – such as a reduction in key interest rates – could alleviate the shock.
Editor finance.net
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