UBS Strategists Project Resilience Amidst Trump’s Shifting Tariff Landscape
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Meta Description: UBS experts predict President Trump’s tariff policy, while potentially high, will not trigger a recession or derail the ongoing bull market.
President Trump’s evolving tariff strategy is not expected to precipitate an economic recession or mark the conclusion of the current bull market, according to influential strategists at UBS. This projection comes as the administration implements a series of significant trade adjustments affecting key global partners.
Tariffs Poised to Peak, But Recession Fears Unfounded
A top investment strategist at UBS Global Wealth Management has articulated a base case scenario where U.S. tariffs could ultimately stabilize around 15%. While this level would represent the highest since the 1930s, and a substantial sixfold increase since President Trump took office, analysts believe the economic system is poised to absorb these changes without catastrophic fallout.
Ulrike Hoffmann-Burchardi, UBS Global Wealth Management’s chief investment officer for Americas and global head of equities, detailed this outlook in a recent note. She emphasized that, despite the historical context of the proposed tariff rates, the firm does not anticipate a resulting recession or an end to the sustained equity bull market.
A Swift Series of Trade Adjustments
In recent days, President Trump has orchestrated a rapid succession of trade actions. These have included a 90-day deferral on duties for goods imported from Mexico, signaling a temporary pause in escalating trade tensions. Concurrently, a 15% tariff has been imposed on goods originating from the European Union, impacting transatlantic trade flows.
Further significant moves were made on Friday, when an order was signed to increase tariffs on imports from Canada to 35%. However, a baseline minimum tariff rate of 10% has been maintained across all trading partners, suggesting a structured approach to the overall tariff framework. The United States is scheduled to implement these new duties this week, ushering in a period of renewed economic scrutiny.
This strategic approach to trade policy, marked by both significant increases and broad minimums, will be closely watched by global markets and policymakers alike. The resilience projected by UBS strategists offers a degree of reassurance amidst the dynamic nature of these international economic adjustments.
