GlobalData TS Lombard: Perkins Vs Beamish "Deal" Done. Crisis "Over"
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May 12, 2025 The hosts dive into the implications of the US-China trade deal and whether it signals the end of economic crisis. They analyze the dollar's uncertain future as a reserve currency amidst rising competition. Political influences shape both the Federal Reserve's interest rate decisions and economic policies in Europe and the US. The discussion highlights the effects of tariffs on growth, mixed with some light-hearted humor, as they urge investors to rethink strategies in this evolving landscape.
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US-China Tariff Baseline Reset
- The US-China tariff situation has reverted to a high baseline from before recent tensions.
- Continued US tariffs and policies will damage US growth, leading to softer but non-recessionary outcomes.
Rebalancing Global Growth Dynamics
- The decline of US exceptionalism reflects policy shifts and rebalancing global demand.
- Europe and China are expected to strengthen their growth through fiscal stimulus and reforms.
Dollar Weakness But Reserve Currency Holds
- The US dollar will weaken structurally due to rebalanced global demand but will retain its reserve currency status.
- Dollar demand remains strong in trade and finance due to network effects and invoicing practices.