Tariff’s impacts on markets and portfolios
The scale of President Trump’s tariff announcements on April 2nd exceeded economist and market expectations, sending the S&P 500 down over 10% in the two days immediately following.1 And while markets rallied following the April 9th announcement of a 90-day pause of reciprocal tariffs (excluding China), significant uncertainty remains.
How tariffs could affect investments
We expect tariffs to lower growth and boost inflation globally. Our Fundamental Fixed Income team, for example, has lowered its 2025 GDP growth expectation to 0% and raised its core inflation expectation to 3.8%.2
Michael Gates, lead portfolio manager of the BlackRock Target Allocation Model Portfolios, estimated that a 20% effective tariff increase could have a…
