Amid growing concerns over Donald Trump‘s economic policies, a recent survey reveals that economists are wary of the potential negative impacts of his “Maganomics” strategy. This comes as Trump prepares for a possible return to the White House.
What Happened: According to a Financial Times reported on Thursday, a survey of over 220 economists across the US, UK, and Eurozone reveals concerns about Trump’s economic strategy, dubbed “Maganomics.” The poll suggests that Trump’s protectionist policies may impede growth despite investor optimism.
Many economists believe that Trump’s return to the White House could lead to inflation and cautious Federal Reserve actions on interest rates. Şebnem Kalemli-Özcan, a professor at Brown University, stated that while Trump’s policies might spur short-term growth, they could also result in a global slowdown, eventually affecting the US negatively.
The survey, conducted with the University of Chicago’s Booth School of Business, found that more than half of the economists expect some negative impact from Trump’s agenda. This includes plans for significant tariffs and deportations, which are seen as inflationary and potentially harmful to growth, according to Janice Eberly of Northwestern University.
See Also: S&P 500’s Record-Breaking 2024 Ends With Four-Day Slump — History Suggests Bullish Days Ahead
Barret Kupelian, chief economist at PwC UK, added, "The Trump administration will be an ‘unpredictability machine' which will dissuade business and households from taking long-term decisions with ease. This will inevitably have an economic cost."
Despite these concerns, the U.S. economy is projected to grow faster than Europe’s in 2025. However, Eurozone economists are particularly worried about the impact on manufacturing, especially in Germany. The U.K.’s large services sector may offer some insulation, but uncertainty remains a concern.
Why It Matters: Trump’s economic strategies have been a focal point of discussion, especially his proposed tariff hikes and deregulation policies. In 2024, the U.S. Dollar experienced significant strength, reaching levels not seen since 2002. Analysts predict this trend may continue into 2025, bolstered by Trump’s tax cuts and tariff increases.
However, these policies also pose risks. Goldman Sachs has warned that Trump’s aggressive tariff plans could lead to economic challenges for North America, with potential GDP contractions for Canada and Mexico. The U.S. could also face a slowdown in growth, highlighting the complex implications of Trump’s economic agenda.
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Disclaimer: This content was partially produced with the help of Benzinga Neuro and was reviewed and published by Benzinga editors.
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