US President Donald Trump's economic policies are muddled and his hawkish stance on trade will be constrained by the pulls and pushes of actual governance, according to market veteran Ramesh Damani.
Citing the example of Trump's vow to ramp-up US crude oil production, Damani said, "The US produces 13 million barrels of oil and now they want to add three million more, which will be an extremely tall order. What will happen to oil prices?"
He also highlighted the flip-flops on ties with China on issues like TikTok, where the US leader has allowed a grace period to pause a domestic ban on the Chinese social media app, even while talking tough on dealing with Beijing.
Trump's opposition to Nippon Steel Corp.'s proposed acquisition of ailing US Steel Corp., citing 'national security concerns', also raises question as Japan is a treaty ally of Washington, he noted.
"You take him seriously, but not literally," Damani told NDTV Profit.
Samir Arora, founder of Helios Capital, pointed out that Trump did not take any of the pledged tariff action on foreign countries on his day one as president.
"If on day one, you sign 100 (executive) orders and in that, tariffs are not there, so it means it's not being on the top of the agenda. If he does it 10 days later, it then means that is a ploy to bargain with trade partners," Arora said.
The fund manager expects uncertainty on US trade policy to hang over for a while, keeping global markets on edge.
During his presidential campaign, Trump vowed to tax imported goods by 100% to reduce the US' massive trade deficit. He has targeted trading partners like China, Canada, Mexico and Europe for "unfair" treatment to American goods and services.
"The world has made a U-turn from globalisation to follow a more mercantilist and protectionist policy," said Damani.
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