Trump tariffs: JP Morgan warns of recession, Wall Street may lose $5 trillion
#News Bureau April 6,2025
US major financial firm JPMorgan has warned that President Donald Trump’s new tariff policies could push the country into recession. Along with this, Trump’s tariff announcement has dealt a huge blow to Wall Street, due to which the stock market has recorded a loss of $ 5 trillion (about Rs 420 lakh crore). This double crisis has raised deep concerns over the global economy, especially for countries like India which are linked to US markets.
JPMorgan’s Chief US Economist Michael Feroli told investors in a note that the tariff policies proposed by the Trump administration—which include 25% tariffs on imports from Mexico and Canada and 10% tariffs on imports from China—could push the US economy into recession. According to Feroli, the implementation of these tariffs will lead to massive job cuts, a decline in gross domestic product (GDP) and a sharp rise in the prices of consumer goods. He estimated that the US economy could enter a recession by the end of 2025.
Analysts say that Trump’s tariffs will increase the cost of American companies, which will affect employment and production. JP Morgan also warned that if Trump’s policies are fully implemented, then US GDP growth could go below 2% in the next two years, which is also a danger signal for global business. Trump had announced the ‘Liberation Day’ tariff at the beginning of his second term, which he described as a strategy to promote American industries and reduce dependence on foreign imports. However, this announcement had the opposite effect. According to the Economic Times report, the news of the tariffs triggered a massive sell-off in Wall Street, due to which $ 5 trillion of value was wiped out from the stock market in one stroke. Major indices like Dow Jones, Nasdaq and S&P 500 recorded a decline of 4-6%.
Experts believe that investors have spread fear that tariffs will affect the supply chain of American companies and reduce profits. Sectors like automobile, technology and consumer goods are expected to suffer the most. A market analyst said, “This is the first big blow of Trump’s economic policies, and it can de-stabilize the US as well as global markets.”
Impact on India too: The US is India’s largest trading partner, and this slowdown can also have an impact on the Indian economy. Experts say that if demand in the US market falls, India’s exports—especially in sectors like information technology, textiles and pharmaceuticals—may be affected. Apart from this, the fall in Wall Street can also lead to volatility in the Indian stock markets.
Trump rejected all criticism and said that tariffs are necessary to save American jobs and strengthen domestic industries. He wrote on social media, “We will not let foreign countries rob America. It is time for liberation.” However, economic experts believe that this policy can backfire, because not only will American consumers have to face inflation, but it can also start a global trade war.
JP Morgan’s warning and Wall Street’s losses have made the start of Trump’s second term difficult. Global investors are now keeping an eye on US policies as it may also impact Europe, Asia and other emerging markets. The Indian government and the Reserve Bank of India may also have to prepare a strategy to deal with this situation.
