US President Donald Trump during a rally at Capital One Arena ahead of the 60th Presidential Inauguration in Washington, DC, United States, Sunday, January 19, 2025.
cyclists | Bloomberg | Getty Images
This report is from today’s CNBC Daily Open, the international markets newsletter. CNBC Daily Open keeps investors informed on everything they need to know, no matter where they are. Like what you see? You can subscribe here.
What you need to know today
Trump says he will declare a national emergency
US President Donald Trump said Monday that he would do so Declaring a national energy emergency – as part of a comprehensive agenda aimed at increasing fossil fuel production – and ending what he called the Green New Deal, withdrawing the United States from international commitments to combat climate change.
Optimistic about the Trump era
Trump’s return to the White House caused panic in some countries due to his threat to impose tariffs and his unpredictable foreign policies. But people in many other countries are optimistic about Trump 2.0, the European Council on Foreign Relations, a think tank, also published. Global survey Wednesday.
Melania$ and Trump$
First Lady Melania Trump launched her own meme coin named “Melania” on Sunday evening. The token is currently trading at $4.20, down from a high of around $13. Trump on Friday also announced a coin called the “Official Trump.” At the peak of coin prices, the Trump family’s net worth rose by billions of dollars, based on their just-launched holdings of digital assets.
Pardon Biden
On Monday, former US President Joe Biden issued a preemptive pardon to a number of family members, citing fears that they would be targeted by “unfounded and politically motivated investigations.” Biden also pardoned Anthony Fauci, Gen. Mark Milley, members of Congress who investigated the Jan. 6 Capitol riot and others who he said were under threat of being “groundlessly” targeted for political purposes.
The euro and the pound strengthen against the dollar
US markets were closed on Monday for Martin Luther King Jr. Day. Pan-European Stoxx 600 index It rose by 0.05%. the euro and British pound It strengthened against the US dollar, as it was reported that Trump will not impose tariffs on US trading partners on his first day in office.
[PRO] The second time is an echo of the first?
A second Trump term could have the same effects on certain asset classes as the first round did, according to some on Wall Street. To find out, CNBC Pro looked at the performance of several assets during the first 100 days of Trump’s last presidency and asked analysts how well those assets performed.
Bottom line
Definitions
“For me, the most beautiful word in the dictionary is ‘tariff,’” Trump told the Economic Club of Chicago in October. During his election campaign, Trump pledged to impose a global tariff of 20% on all imports into the United States, and 25% on goods. Coming from Canada and Mexico, more than 60% on Chinese products.
Governments impose tariffs ostensibly to protect domestic industries. Companies that import goods pay what is essentially a tax, which leads to higher costs. This prompts them to look for local suppliers instead.
As supply chains become more integrated globally, and much of their manufacturing takes place outside the United States, companies may find it difficult to shift production to local shores. Hence, higher costs are likely to be passed on to the consumer in the form of increased prices.
In other words, tariffs could lead to more inflation.
Deportations
At an event preceding his inauguration entitled “Make America Great Again, Victory March,” Trump pledged to his supporters that “the invasion of our country will stop.” Like tariffs, stricter immigration policies — or outright deportations — are usually enacted to protect the domestic economy (among other reasons).
The theory is that with fewer people competing for each open job, it will be easier to get work.
But many sectors of the American economy, such as construction and agriculture, are staffed by illegal immigrants, who work in jobs that are undesirable for residents. Even documented immigrants play a crucial role in highly skilled sectors like technology — as proven by Elon Musk’s tussle with Trump supporters over… H-1B visas.
If reliable labor sources disappear overnight, companies will be forced to raise wages to attract talent, which could raise the possibility of a frightening spiral between wages and prices.
Other policies
Trump has promised several other economic measures, such as cutting corporate taxes, legalizing cryptocurrencies, and withdrawing green energy subsidies.
However, tariffs may have the greatest impact on the economy and financial institutions globally.
— CNBC’s Sam Meredith, Ryan Ermey, Annie Nova, Rebecca Picciuto, Evelyn Cheng and Lim Hui Jie contributed to this report.