Impact of Tariffs on Global Trade

In this issue, we’re diving into the complex world of tariffs and their impact on the global economy. The ripple effects of tariffs can be felt across different regions, influencing economic growth and inflation on a worldwide scale. With uncertainties surrounding the size and timing of tariffs globally, we’re seeing some serious considerations being made in response to the incoming US administration’s early statements.

One recent development from the US Federal Reserve highlighted this uncertainty. After cutting interest rates by a quarter point in December, the Fed changed its 2025 forecast, leading to a negative reaction in financial markets. Now, the Fed is expecting a smaller reduction in rates later this year than previously anticipated, sparking discussions on the future of low interest rates. Fed Chairman Jerome Powell compared this change to driving at night on a foggy, unfamiliar road, reflecting the uncertainties surrounding the new US administration’s policies. This situation offers a preview of the potential economic impacts of tariffs, especially in relation to inflation. Additionally, the political tensions arising from a heated congressional budget battle over funding the US government are adding to the stakes in the early days of Donald Trump’s presidency.

In another spotlight of this issue, Global Salon features a deep dive into M&A deals worldwide. Professors Baruch Lev from NYU Stern School of Business and Feng Gu from SUNY at Buffalo’s School of Management share insights from their study and book on over 40,000 M&A deals, revealing a surprising 70% failure rate. They analyze the main reasons behind this high failure rate, focusing on company size, sectors, and factors like manager incentives and due diligence. The practical advice they offer aims to reduce the risks of failure in M&A deals.

We also honor the memory of our late colleague Gordon Platt with our annual FX awards, showcasing a growing volume and increasing innovation in this sector. These awards serve as a tribute to the legacy of Gordon Platt and highlight the ongoing advancements in technological innovations within the industry.

As we navigate the complexities of tariffs, M&A deals, and technological advancements in the financial world, we are committed to providing you with timely and insightful coverage to help you make informed decisions in today’s ever-changing landscape.

Andrea Fiano | Editor at Large | afiano@gfmag.com