The impact of political uncertainty on the global economic market

Seeing the headlines in the newspapers, many of us think about how it will affect you directly, but what about how things like this will affect the weekly grocery store and even them? trade agreements for your business? In this article, we’ll give you an overview of the extent of political uncertainty that can impact the global economic market as a whole.

The trade agreement between the United States and China

As the ongoing US-China trade war shows no sign of resolution, the US and China are meeting again to discuss a resolution. However, in a meeting on December 2, 2019, Trump said that a China deal could wait until after 2020 in order to get the best deal possible for the United States. However, it came as a shock to a number of investors, with stocks slipping with news of no deadline in sight. The FTSE 100 stock slumped over 81 points to a low of 7,203 points, making it the lowest level in nearly two weeks.

Rising tensions with North Korea

Another element of political uncertainty that has affected the global economic market is rising tensions between North Korea and the US government. With a relationship that has been anything but fluid, Trump and Kim Jong Un are having a number of meetings to discuss relations between the two nations. However, that in itself has been anything but smooth. With tensions peaking in 2017 with a threatened gunfire, it’s a relationship that has threatened to disrupt the global market on several occasions. Whether it is tariffs imposed on imported goods or even the price of oil, all of this can be increased at any time if the two countries start to disagree.

The Brexit effect

The third and final major political upheaval disrupting the global economic market is the lingering issue of Brexit. As the UK draws closer to its next EU exit deadline, a divided nation heads to the polls on December 12 to decide who it wants to lead its country. While there has been great political uncertainty in the UK, there has actually been an increase in the rebound rate for the economy as there has been a 0.7% increase in the first three months. August. Although there are still a number of uncertainties surrounding Brexit, such as the leave deal and trade laws that will be affected after Britain exits the European Union.

The impact on international trade

As these political issues continue to grab the headlines, many of us forget the economic impact they can have, especially on businesses across the country. Not only is there a likelihood of trade being disrupted, but there is also the possibility that tariffs affect the overall costs of importing goods. This is a problem already present in the United States, as a 15% duty has already been imposed on a number of products in Apple’s catalog. While that didn’t affect Apple’s monthly earnings much, it is expected to change on December 15, as it is expected to be a 15% import tax on products.

Apple isn’t the only one affected by this, as it will impact a number of other tech companies as import taxes start to rise. This may have a lasting impact on international trade, as a number of countries close to the United States in terms of trade have experienced above-average trade uncertainty. This then adds to the current political uncertainty in the UK as it causes a number of huge companies to consider moving their headquarters as a result.

The rise of social trading platforms

Amid all this political uncertainty, it is common for the price of gold and other commodities to rise as these are investments that do not lose value during political unrest. However, due to the decentralized nature of these digital currencies, they continue to thrive in times of political uncertainty. With a constant circulation of money and a number of CopyTrader Options industry leaders such as Etoro, the number of users has reached more than 10 million. This has seen the number of features, including CopyPortfolios in 2016, that allow those who want to see some of the best investors on the platform and replicate their success. In addition to this, the implementation of such technology has also allowed users to take advantage of predetermined marketing strategies to emulate the success of top marketers. This style of technology subsequently led to an increase in similar technologies as well as the expansion of the Etoro platform to meet the growing popularity of online currencies.

The impact on international trade

In addition to the impact of international trade, there is also the urgent question of the impact this will have on international trade. With a number of businesses hit by major political turmoil and economic blows leading to faltering annual revenues, this can lead to a lot of hesitation when it comes to investing.

Additionally, there is a great deal of turmoil when looking at the headquarters locations of a number of large companies, as political turmoil can result in some businesses being pulled out and moved elsewhere. This is therefore detrimental to the economy of this country because there will be less expenditure. This has already been seen after the Brexit vote, as a number of factories have started to shut down and thousands of jobs have been cut. In addition to this, a number of leading retailers such as John Lewis and Sainsburys have also said that their business could be affected by the increase in prices, thus causing problems for the costs of running a business. .

The future of the global economic market

Although the future of the economic market continues to crumble and change with every event that unfolds, it looks promising for the UK after exiting the European Union as the price of the pound is expected to slowly rise over the course of the year. over the years. Although some reports say this is only a small increase over what the economy would have been, it is a bright future for the global economic market.

However, with the end of the trade war between China and the United States that looks likely to continue until after the 2020 election, this is still an urgent issue as a number of large companies might hesitate. to invest in the first place.

With this in mind, political uncertainty can affect the global economic market in several ways, whether it is an increase in raw materials or an overall increase in the prices of imported products, all of which can affect business at long term.

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