US industry under pressure: tariffs and interest rate policy burden growth!

US industry under pressure: tariffs and interest rate policy burden growth!

The current situation of the US economy shows significant signs of uncertainty and challenges. Tensions in foreign policy and persistent customs disputes leave their traces in the US industry. In April 2023, the Ministry of Commerce reported a decline in orders for long -lasting assets by 6.3 percent compared to the previous month. These figures exceeded the forecasts of the economists, who predicted a minus of 7.8 percent, and followed a revised increase of 7.6 percent in March. In particular, the sunken orders of aircraft could be seen as the main cause of this decline, possibly also in connection with the customs disputes. It is worth noting that a delicate increase of 0.2 percent was recorded without taking into account the transport sector.

The uncertainty about the US foreign trade policy has increased clearly, while the US Federal Reserve is under pressure to carry out possible interest reductions. Neel Kashkari, a leading US Federal Reserve, demanded patience in interest reductions despite President Trump's incentives. So far, the key interest rate has been retained in a range of 4.25 to 4.50 percent since December 2022. These uncertainties could have both a short -term and long -term effects on the economic stability of the United States and beyond.

interest reductions and their effects

A recent interest rate of the US Federal Reserve by 0.5 percent to a range of 4.75 to 5.00 percent was seen in response to progress in the fight against inflation, but also in the context of a cooling labor market. Jerome Powell, the head of the Fed, believes that this measure is necessary to promote growth. Experts have hope that this interest rate reduction could have positive effects on the German economy that suffers from a weakening economy. Michael Grömling from the Cologne Institute of German Economy emphasizes that investment good manufacturers in particular could benefit from falling financing costs.

The interest rate reduction could not only have a stabilizing effect in the USA, but also internationally, including Germany. The Dax broke the 19,000 points for the first time after this interest rate reduction and indicates a certain confidence in the markets. In the United States, lower loan interests could benefit both companies and consumers, which could lead to more investments.

global effects and exchange rate risks

The US Federal Reserve's interest rate policy has a significant impact not only on the US economy, but also on the international economy. Rising interest rates can make loans more expensive, which can reduce financing from private households and companies. In addition, there is a direct connection between falling demand, slowing down the economic growth and the decline in price pressure. Even if the European inflation rate is currently high at 5 percent, the European Central Bank (ECB) adheres to its zero interest rate policy and announces a possible rate increase.

The low euro course could, however, favor German exports, since a high demand for dollars results in devaluation of the euro. Savers in Germany currently see no prospect of interest increases, which favors investment in shares and real estate. In the United States, cooling at the unemployment rate is predicted by the end of the year, which changes the space for further interest steps. Long -term savings plans in stock systems could be recommended to better compensate for possible price fluctuations.

experts agree that the interest policy of the Fed must be handled flexibly in order to be able to react to current developments. Michael Heise from HQ Trust sees no upcoming recession and expects minor interest steps until the end of the year. Carlos de Sousa of Vontobel predicts that the US key interest rate could continue to drop to around three percent by mid-2025, which will influence market volatility.

for companies and consumers in the USA, as well as for the global economy, the monetary policy of the Federal Reserve remains a central topic whose developments must be observed closely.

krone , ZDF , taz