Trumponomics: Make US companies more profitable again

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US Elections News

Unitedstates,Banks,Fiscalpolicy

The goal of a restrictive US trade policy is to reduce the US current account deficit.

That seems to me to be the sense of the tariff threats in economist terms. The incoming administration seems to want to do everything to make US companies more profitable: low corporate taxation, the lifting of environmental and consumer protection rules, etc. can probably be subsumed under this heading. In addition, US fiscal policy is likely to become much more expansionary, Commerzbank’s Head of FX Research Ulrich Leuchtmann notes.

The reported statistics do not reflect this truism, but only because official statistics cannot capture all transactions.” “The combination of a business-friendly US economic policy, an expansive US fiscal policy and a restrictive Fed monetary policy leads to USD strength and thus in such a situation capital flows increasingly into the USA and the strong dollar worsens the price competitiveness of the US economy) to higher deficits in the US current account.

 

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