How could Donald Trump's tariffs affect the UK?
Published On Feb 3, 2025, 1:31 PM
Donald Trump has hinted at the possibility of tariffs on UK goods, citing concerns over trade balances. Economists indicate that Britain could be negatively impacted by Trump's trade policies, even if it avoids direct tariffs. This includes potential slower growth in trading partners, increased borrowing costs, and disruptions in supply chains. The UK currently has a trade surplus with the US, but inconsistencies in data reporting between the two nations complicate the picture. If tariffs are applied, they could significantly affect UK exports, particularly in pharmaceuticals and automotive products.
Stock Forecasts
GSK
Negative
Given the uncertainty surrounding UK-US trade relations and the possibility of tariffs impacting key UK exports, the forecast is negative for companies heavily reliant on exports to the US. The potential economic slowdown in the UK due to increased borrowing costs and lower demand could further hurt investor sentiment. It is advisable to monitor how trade policies evolve and their effect on the respective sectors.
HSBC
Negative
With Trump's tariffs potentially increasing borrowing costs and affecting economic growth in the UK, financial stocks may face headwinds. Higher interest rates in the US could also influence UK markets negatively, potentially hurting major banks.
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