The impact of Trump's election win on the world economy.

• The election of Donald Trump to the White House signifies a remarkable political resurgence, which is expected to have profound consequences for the world economy.
• The ex-president's list of campaign promises included high tariffs, tax reductions, deregulation, and a plan to exit significant international accords.
• According to Ben May of Oxford Economics, the immediate impact of Trump 2.0 on global growth may be minimal, but it has significant implications for trade, the composition of growth, and financial markets.

The election of Donald Trump over Vice President Kamala Harris signifies a historic return to the White House, marking an unprecedented political comeback that is expected to have profound consequences for the world economy.

Trump, addressing his supporters in Florida on Wednesday, declared that an "unprecedented and powerful mandate" would usher in "the golden age of America."

The ex-president's list of campaign promises included high tariffs, tax reductions, deregulation, and a plan to exit significant international accords.

The consequences of any measures Trump implements in his second term will have repercussions across the globe, but it is difficult to determine the extent to which he will seek to implement them.

It is uncertain what type of presidency investors can anticipate when Trump returns to the White House, according to Lizzy Galbraith, a political economist at asset manager Abrdn.

On Thursday, CNBC's "Squawk Box Europe" featured John Galbraith stating that Congress has a significant role to play.

"If Trump gains unified control of Congress, as is expected to happen soon, he will have more freedom to pursue his tax-cutting and deregulatory agendas. However, his trade policy is also likely to be a part of this."

According to Galbraith, there are two perspectives on tariffs. Trump may use them as a negotiating tool to obtain concessions from others or fulfill his pledge and apply them on a broader scale.

Trump's favorite word

Trump has previously referred to "tariff" as his favorite word, describing it as "the most beautiful word in the dictionary."

To increase earnings, Trump has proposed imposing a 20% tariff on all imported goods into the U.S., with a maximum of 60% for Chinese products and a staggering 2,000% on vehicles made in Mexico.

Trump has stated that the European Union will face consequences for not purchasing enough American goods.

According to Galbraith, when Trump imposes tariffs, his primary concern is China, and he doesn't see his secondary tariff promise, which would negatively impact European companies, as a realistic possibility.

Although it's not our primary concern, there is a possibility that certain European products could be affected by a baseline tariff.

Experts have cautioned that implementing universal tariffs under President Trump's plan may increase prices for customers and decrease consumer spending.

Europe

According to Ben May, director of global macro research at Oxford Economics, the immediate impact of Trump 2.0 on economic growth is likely to be minimal. However, it has significant implications for trade, the composition of growth, and financial markets.

If Trump's more radical policy agenda is adopted, particularly on tariffs, the impact across the globe will be significant.

May stated in a research note that a clean sweep could increase the likelihood of the Trump administration implementing more extreme policies, including larger, less-targeted tariffs.

The uncertainty about Trump's stance on the conflicts in Ukraine and the Middle East increases the risk of instability in both regions, which could negatively impact regional and global growth, according to him.

The possibility of a second Trump presidency was widely considered unfavorable for Europe and the European Union as a whole.

Signum Global Advisors' research note on Wednesday stated that the magnitude of the truth is often underappreciated by analysts.

The EU is likely to suffer the most in a second Trump era due to trade tensions, European policy frustrations, and Trump's potential desire to strengthen America's position in attracting capital relocation.

Asia

According to Macquarie Group analysts, Trump's election victory is considered "bad news for Asia," particularly China. However, the region is now "more prepared" than in 2016, when he first entered the White House.

The analyst at Macquarie Group stated in a research note that while Trump's campaign emphasized higher tariffs, the potential headwinds in Asia, particularly China, could increase volatility and decrease multiples due to uncertainty.

"To counterbalance this, the Chinese government has outlined its plans to stimulate the economy and address property market issues to boost domestic consumer confidence."

According to Mitchell Reiss, an American diplomat and distinguished fellow at the Royal United Services Institute (RUSI) think tank, there may be variations in the Trump approach this time.

On Thursday, Reiss stated on CNBC's "Squawk Box Europe" that President-elect Trump intends to increase tariffs on China again until the playing field is level, as per his view.

The last time Trump won, the number of China hawks in his administration was what stood out. This administration was tough in terms of personnel and their view of China as an adversary, expansionist in the South China Sea, and contrary to American values and friends and allies around the world.

"I believe that the situation will not change significantly, but the economic interaction with China may ease it somewhat. However, I anticipate that our relationship with China will remain complex in the future."