Donald Trump’s ‘meganomics’ will hurt growth, economists tell FT poll.

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Donald Trump’s protectionist policies that reposition the world’s largest economy as “America First” will hurt growth, according to economists at the Financial Times, at odds with the plans of the US president-elect for investors.

More than 220 economists in the US, the UK and the Eurozone conduct research on economic impact TrumpMost respondents believe his return to the White House will offset what other president-elects have called “meganomics.”

Most US economists polled by the FT and the University of Chicago’s Booth School of Business believe a new Trump term will trigger. Inflation And it brings more caution from the Federal Reserve in cutting interest rates.

“Trump’s policies may bring some growth in the short term, but this will come at the cost of a global slowdown, which will then rebound and hurt America,” said Sebnam Kalemli-Ozkan, a professor at Brown University. On the New York Fed’s Economic Advisory Panel. “His policies are inflationary in the US and the rest of the world, so we’re moving into a volatile world.

However, most economists – including the IMF, OECD and European Commission – predict stronger growth in the US than in Europe by 2025.

The U.S. economy grew at an annualized rate of 2.8 percent in the quarter last year, consistently outpacing its transatlantic counterparts since the coronavirus pandemic.

Trump still hasn’t released comprehensive economic policy promises, leaving analysts to base their views on promises and threats made on the campaign trail.

These include plans to impose blanket tariffs of up to 20 percent on all U.S. goods, mass deportations of illegal workers, cuts in red tape, and making tax cuts permanent in 2017.

A self-described “tariff man,” Trump has a long-standing and deep-seated belief that America must close its trade deficit and boost domestic production.

Janice Eberly, a former senior US Treasury official in the Obama administration, said: “The announced policy includes high tariffs and the deportation of immigrant workers.” “Both can be negative for inflation and growth.”

Overall, more than half of the 47 economists asked specifically on the U.S. economy expect “some negative impact” from the Trump agenda, and another tenth predict a “large negative impact.” On the other hand, a fifth of those surveyed expect a positive effect.

The gloom among economists contrasts with investors’ optimism about Trump’s second term.

US S&P Equity Index increased. In the weeks since Trump’s win, though, it has pared some of the gains in December after U.S. regulators said they would cut less this year than previously expected.

in the The best two-year run of this centuryThe benchmark index increased by 23.3 percent in 2024, and achieved the same gain in 2023.

Bank of America strategist Benjamin Bowler said this week that Trump’s “laissez-faire economics, tax cuts and deregulation” combined with the “AI revolution” mean the rally could continue until 2025.

A separate survey by the FT found that eurozone economists were more pessimistic about the impact of Trump’s policies on their region than those in the US, with 13 percent of analysts expecting a major negative impact and another 72 percent predicting some downside. Results.

The main concern for the Eurozone is manufacturing Especially in GermanyThe region’s largest economy.

Martin Wahlberg, chief economist at General Investments, highlighted the possibility that the nation’s auto industry would be “particularly targeted” by Trump.

Trump’s threat to impose 60 percent tariffs on China could further challenge European industries, said Christophe Boucher, chief investment officer at ABN Amro Investment Solutions, as it creates an opportunity for Beijing to flood the region with cheap goods.

While the UK is better off from tariffs thanks to its large services sector, Alpesh Paleja, chief economist at the CBI, has warned that the country is vulnerable to a “second round effect” as tariffs weigh on growth in the Eurozone.

More than 56 percent of nearly 100 respondents in the United Kingdom expect some negative impact, with many citing a sense of drag on sentiment from the climate of uncertainty ahead of Trump’s inauguration on January 20, while more than 10 percent predict some positive impact.

Barrett Kupelian, chief economist at PwC UK, said: “The Trump administration will be an ‘unpredictable machine’ that prevents businesses and households from taking long-term decisions easily.” “It’s inevitable that there will be an economic cost.”