Hello MarketShalians, welcome to today’s chapter of World Economy Actions and Its Impact. Indian market is enjoying a holiday today. If one were to guess the mood and atmosphere, Dow seems to be doing well in the future. A bullish atmosphere has been created in both European and Asian markets. Taking a cue from that, Nifty is also showing gains of more than 1 percent. So it can be said that if US markets do not show any surprise fall today, Indian market is going to start with a bullish trend tomorrow. Dollar Index is still around 99. Gold and Silver are witnessing some profit booking from their yesterday’s highs. Let us see what the World Economy Actions are telling us and what impact they are likely to have.
Table of Contents
Trump’s Tariff Tactics vs. Global Unity: Why India and Africa Are Moving Ahead
The capital goods sector is going to be the next big thing due to the growth of manufacturing in India, which will establish India as a great economy. Many believe that the upcoming tariff negotiations are likely to open the floodgates to widespread corruption. The US economy is turning from the world’s leading free market to a leading example of crony capitalism. The President of Burkina Faso, Ibrahim Traore said that “Africa does not need the World Bank, the IMF, Europe or the US. We Africans have everything that is needed to grow our economy without any debt. We cannot continue to be financial slaves using debt”. India is looking very good economically! S&P Global Market Intelligence believes that India’s nominal GDP could nearly double from $3.6 trillion in 2024 to over $7 trillion by 2031, potentially making it the world’s third-largest economy. Furthermore, a report by Standard Chartered Bank suggests that India’s per capita income could grow by nearly 70% to $4,000 by 2030. In today’s context I feel that the countries of the world should side with China and maintain their tariffs for 40 days or until Trump stops targeting China in an attempt to destroy its economy. If Trump is able to use this “technique” to destroy China, he will use it on any country in the world. It is clear that he really does not understand that, today we are all operating as one world economy, and you cannot break away with tariffs. To stop imports you must either make the same quality and cost of goods yourself or import the factory and use American labor.
US Sanctions and Tariffs Backfiring? Russia Grows While EU Faces €52 Billion Loss
Losing consumer confidence as well as investor confidence in US bonds is the real long term harm in all of this. It could encourage the world to look to a non-US currency as its backstop which would be sad for the US economy. Hopefully it doesn’t get worse.
Russia is already under sanctions, extending the sanctions period will make no difference to Russia’s economy which is growing faster than the US despite the sanctions. The threat of sanctions is just a sham.
French President Emmanuel Macron has warned that US tariffs still in place against Europe will weigh heavily on trade even if long term tariffs are negotiated. The partial suspension of US tariffs for 90 days is a signal and an open door for dialogue. But this pause remains fragile, he posted on X. Macron said, without specifying a time frame, that the remaining tariffs on steel, aluminum, cars, as well as a total of 10 percent tariffs, would cost the EU €52 billion in losses. Just yesterday he was talking to very worried entrepreneurs and industrialists. The US tariffs are badly affecting their businesses.
Recession Ahead? Global Markets React to Trump’s Tariff Crackdown and Dalio’s Warning
Global equity markets surged on Monday, with Trump and other US officials downplaying the idea of a reprieve, saying sectoral tariffs on electronics would still be in effect as part of government investigations into semiconductors, which face a separate round of tariffs. The US president wrote on his Truth social platform “No one is getting ‘exemptions’ for the unfair trade balance and non-monetary tariff barriers used against us by other countries, especially not China, which treats us the worst by far!”
China’s March trade data showed the impact of a rush to stock up on goods in the US ahead of the Trump tariffs. China’s exports jumped last month amid a rush to send shipments before the tariffs took effect. China’s exports, measured in US dollars, increased by 12.4% in March compared to the same month last year. Imports fell 4.3%, a less sharp contraction than the 8.4% drop in the January-February period.
Ray Dalio, the billionaire founder of hedge fund firm Bridgewater Associates, warned yesterday that Trump’s tariffs are “very destructive”. Speaking on NBC yesterday, Dalio said “I think we’re at a decision point right now and very close to a recession and I worry that if this is not handled properly, something worse than a recession could happen.”
The tariff war between the US and China has been a “boon” for Brazil’s agriculture sector. Brazil, the largest economy in Latin America, is on track to surpass the United States as China’s leading food supplier, while American farmers urge President Trump to reach a trade agreement with Beijing.
Conclusion and disclaimer
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