UBS On-Air: Market Moves Across the Pond: What comes next for global trade?
Apr 17, 2025
Paul Donovan, Chief Economist for UBS GWM, shares his expertise on the shifting tides of global trade. He delves into the implications of rising tariffs and the looming threat of a trade war, focusing on how these developments may impact Europe. Donovan discusses the recent drastic hikes in tariff rates and their ramifications for various sectors. He also offers strategic investment advice for navigating market volatility, highlighting resilient stocks in Europe that could provide stability amidst uncertainty.
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US Tariffs at 100-Year High
- US tariffs have significantly increased since April 2nd, now averaging around 24%.
- This marks the highest trade taxes in the US in over 100 years, escalating tensions especially with China.
Trump's Tariff Mindset Explained
- President Trump's trade policy shows erratic shifts without a master plan.
- His views on tariffs are shaped by 1980s real estate conflicts, not modern global trade complexities.
Europe Feels Impact, But US Loses More
- Europe and Switzerland face 10% tariffs with certain exceptions like autos taxed at 25%.
- US tariffs aggressive and broad cause more harm to the US economy than reciprocal European tariffs.