In this “Deeper Dive”, Gavyn Davies, Founder and Executive Chairman and Andy Bevan, Partner and Economic Advisor, discuss the following:
- Historical tariff levels in the US were much higher than current rates
- The motivations for tariffs include revenue generation, trade protectionism, and reciprocation
- The “escalate to de-escalate” strategy is a key negotiation tactic
- National security concerns are intertwined with trade policy
- China’s response to US tariffs could escalate tensions
- The dollar’s dominance in global trade affects US competitiveness
- The potential economic impacts of tariffs include lower growth and higher inflation
- The Fed may adopt a cautious approach due to trade uncertainties
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