0419 GMT - It's tempting to take comfort in the fact that no tariff were imposed in the first week of Trump's presidency, but it's extremely early days yet, DBS chief economist Taimur Baig says. Stocks and bond rallies point to ebbing fears of inflation or fiscal slippage, and a USD selloff suggests tariffs will prove benign. But Trump has talked about his belief in tariffs for four decades, and DBS's team is skeptical that his term will begin and end with minimal tariffs. Trump's mercurial policy-making poses myriad risks, including retaliation from other nations, Baig says. And the U.S. macro cycle is not conducive to a bout of policy fog. "Trump's actions to deregulate and cut taxes, and desire to tighten labor supply and lower borrowing costs, are a recipe for economic overheating." (fabiana.negrinochoa@wsj.com)
(END) Dow Jones Newswires
January 26, 2025 23:19 ET (04:19 GMT)
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