Trump 2.0: How to navigate global markets amid policy shifts
Subscribe to enjoy similar stories. With Donald Trump’s return to the White House, global markets are bracing for another wave of ‘America First’ policies. His renewed emphasis on domestic manufacturing and reduced reliance on outsourcing signals a continuation of his first-term agenda.
This shift became immediately evident with a series of executive orders imposing significant tariffs on imports from China, Canada, and Mexico. On 1 February, Trump issued a 10% duty on Chinese imports and 25% tariffs on Canada and Mexico, with a lower 10% rate on Canadian energy exports. However, after negotiations, the tariffs on Canada and Mexico were temporarily suspended for 30 days, underscoring the evolving nature of these trade policies.
Also read | Mint Explainer: Will tariff reductions and a trade treaty with US harm India? Financial markets responded swiftly. Global stock indices tumbled, the US dollar strengthened, and oil prices surged. The Canadian dollar plunged to a 20-year low, while the Mexican peso saw heightened volatility.
These sharp reactions reinforce the need for investors to stay vigilant as markets adjust to policy shifts. Paradoxically, despite trade tensions, Trump’s election has fuelled economic optimism — particularly among small businesses in the US. The NFIB Small Business Optimism Index surged to 105.1 in December 2024, its highest level since October 2018.
The net percentage of small business owners expecting the economy to improve jumped 16 points to 52%, the highest reading since 1983. Also, 20% of small business owners now view this as a good time to expand, marking a six-point increase from the previous month. This rising confidence could drive broader economic momentum, contrasting with the narrow,
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