The main impact on India will not be US tariffs. It will be the coming recession caused by Trump’s actions. That will depress the GDP of all countries, including the US and India.
The bond market has not settled down even after Trump’s ceasefire. The spectre of financial meltdown is once again haunting markets, which no longer trust Trump or his financial wisdom
President Trump has met a force he cannot combat. The US gilt market (for govt bonds), the lynchpin of the global financial system, began to slide alarmingly as he prepared last week to impose enormous tariffs across the board.
Normally, in troubled times, US gilts rise as global money rushes into safe havens, of which US gilts have long been the safest. Instead, they slid down, indicating a panicky disappearance of all safe havens and a financial meltdown. Donald Trump was forced to pause his ‘reciprocal’ tariffs for 90 days. Markets were relieved globally.
Normally, in troubled times, US gilts rise as global money rushes into safe havens, of which US gilts have long been the safest. Instead, they slid down, indicating a panicky disappearance of all safe havens and a financial meltdown. Donald Trump was forced to pause his ‘reciprocal’ tariffs for 90 days. Markets were relieved globally.
This article was originally published by The Times of India on Ape 6, 2025
