Best printers for Home

Best Mixer Grinder

Best wired Earphones

Best 43 Inch TV in India

Best Wi Fi Routers

Best Home Theatre in India

Smart Watch under 5000

Best Laptops for Education

Best Laptop for Students

India could see a shift in foreign direct investment (FDI) trends in the second term of Donald Trump (Trump 2.0) as President of the United States, says a research report by the State Bank of India. The report highlighted that under his first term, Trump 1.0, the Trump administration made sweeping regulatory changes aimed at attracting investments back to the U.S., which impacted FDI inflows globally, including India. It added that if similar policies are reintroduced in Trump 2.0 also, it could create challenges for emerging markets like India, which rely on FDI as a significant driver of economic growth. Notably, a recent Kotak report highlighted that a complete Republican control over all arms of the US government would mean increased US earnings via corporate tax cuts, higher tariffs on imports into the US and greater US fiscal deficits. The first two could spell doom for emerging markets like India and China, since foreign investors will make a beeline for investing more money in the US markets, which will come at the cost of intense selloff in emerging markets. However, higher fiscal deficits will eventually lead to the dollar weakening after the initial euphoria dies down. "India may see shifts in foreign direct investments (FDIs) during Trump 2.0. The Trump 1.0 administration saw significant regulatory changes aimed at attracting investments back to the US," the SBI report stated. However, given that India has been gradually diversifying its sources of FDI (foreign direct investments), this trend could serve as a buffer against any potential decline. Moreover, domestic institutional investors have been stepping up big time, maintaining some balance to the massive exodus of FIIs over the past month. So far in November 2024, FIIs have withdrawn Rs 19,849 crores from the cash segment in Indian markets, while DIIs have poured in Rs 14,014.18 crores as of November 10th, 2024. "India is no longer dependent on the traditional sources of FDI inflows... unlike the recent past, FDI is now coming in many new sectors," noted the SBI report. Unlike a decade ago, when most FDI inflows came from a limited number of traditional sectors, India is now attracting investment in a wide array of industries, including renewable energy, sea transport, medical devices, and surgical appliances. Data suggests over the last 24 years, i.e., between April 2000 and June 2024, FDIs have poured in $1,013.4 billion in the Indian economy. Out of this, 67%, i.e., $689.88 billion, has come in just the last 10 years. The report added there are up to 12 emerging sectors showing strong FDI interest, which could help offset any loss of inflows in conventional sectors if there is a shift in global investment patterns under another Trump administration. In the last financial year, the top 5 sectors that have received the highest quantum of FDI inflow include the services sector (finance, banking, insurance, and business) which makes up about 16% of the inflows. This is followed computer software &amp; hardware, which constitute around 15% of total FDI flows. Trading and telecommunications follows with a share of 6% each, and Automobile Industry comes next with a 5% share. In the short term, the potential for increased U.S. tariffs, more restrictive H-1B visa policies, and a stronger dollar could bring some volatility to India's trade and investment landscape. However, in the long term, these challenges might also encourage India to expand its manufacturing capabilities, diversify export markets, and focus on becoming economically more self-reliant. Notably, India has maintained a merchandise trade surplus with the U.S. despite tariffs imposed during Trump's first term. This indicates that Indian exports have remained resilient, and there is potential to strengthen this trade relationship further by capitalizing on emerging sectors and reducing dependency on traditional industries. Suman Chowdhury, Executive Director &amp; Chief Economist, Acuité Ratings &amp; Research Limited cautions that in the medium to long term, the trade relationship with the US may see a structural improvement. "Higher tariff and trade restrictions in the US with China should translate into better opportunities for exports of manufactured goods from India", he adds.

FDIs may shift to US under Trump 2.0 but it is unlikely to severely impact FDIs inflow to India, says SBI Report

Foreign investors have withdrawn nearly Rs 20,000 crore from Indian stock markets in just five trading days (November 4–8), continuing a trend of large-scale selling that began last month. Experts say investors are now moving their money to China, largely due to the high valuations presently prevailing in Indian markets. In early November, FPIs have offloaded as much as Rs 19,994 crore in Indian markets. The month prior, i.e., October, was one of the worst months in terms of foreign outflows, with FPIs making a net withdrawal of Rs 94,017 crore. Before this, Indian markets faced such a situation during the pandemic, when FPIs withdrew Rs 61,973 crore from equities in March 2020. <h2>Why Are Investors Leaving? </h2>According to Himanshu Srivastava of Morningstar Investment Research India, two main factors are driving this exodus. First is China's renewed appeal due to lower stock valuations and new economic stimulus measures. In a bid to nudge the domestic economy and bail state governments, China recently approved a 10-trillion yuan (US $1.4 trillion) package. Per reports, approximately 60% of this stimulus focuses on allowing local governments to refinance the mountain of debt on them. Srivastava explains foreign investors are also flocking to US dollar and Treasury yields, which have appreciated significantly in the recent past, leading FPIs to anticipate a stronger US economy going ahead. Moreover, high valuations in Indian markets are discouraging foreign investors from putting more money in the economy. As a result, over the past week, the selling pressure eroded Rs 74,563 crore in market value for Reliance Industries, while Bharti Airtel and ICICI Bank lost Rs 26,274 crore and Rs 22,254 crore, respectively. The combined market valuation of six of the top 10 most-valued firms dipped by Rs 1,55,721.12 crore last week. <h2> Silver linings</h2>Despite the ongoing outflux of funds since last month, November also saw unprecedented applications of about 40–50 new FPI registrations, which are eyeing to enter the Indian market. This was due to markets SEBIs recent relaxation to NRIs, permitting them to participate up to 100% and announcing measures for ease of entry and operations in India. On the other hand, FPIs invested Rs 599 crore in the debt general limit and Rs 2,896 crore in the debt voluntary retention route (VRR) during the period under review. So far this year, FPIs have invested Rs 1.06 lakh crore in the debt market. <li class="whitespace-normal break-words"></li>Going ahead, investors will be looking for certain macroeconomic cues, which include corporate earnings reports, India's inflation (CPI) and industrial production (IIP) data on November 12, the US inflation report on November 13, and wholesale price index (WPI) data on November 14.

FPIs withdraw nearly Rs 20,000 crore from equities in the last 5 trading sessions, make a beeline for China and US

<ul class="summary-list"><li>Europe could take a hit to GDP in a second Trump presidency, Goldman Sachs analysts say.</li><li>They point to increased uncertainty as the scope of the timing of Trump's sweeping tariffs remains unclear.</li></ul>As the world takes in the results of the US presidential election, regions around the world are determining what a Trump presidency might mean for their economies.Europe could face a big hit to economic growth as trade tensions increase, Goldman Sachs analysts said. The analysts downgraded their growth forecasts across the region, down to 0.8% from their previous forecast of 1.1% for 2025. In 2026, the analysts said they expect growth of 1%, down from 1.1% and lower than the consensus estimate of versus 1.4%. Overall, the analysts expect the Euro area to take a 0.5% hit to real GDP, with the bulk of the downturn set to materialize next year.The analysts point to renewed trade tensions fueled by Trump's proposal for sweeping tariffs on all US imports.More significant than the actual tariff increases, though, will be the trade policy uncertainty that comes with them, the analysts say. That uncertainty will pose a bigger hit to growth than the tariffs themselves, they said. "The actual magnitude of tariff increases might matter less than the uncertainty created by threatening to impose tariffs on Europe," the analysts said in a Wednesday note, adding, "The magnitude of the tariff increase, however, is unlikely to be clear for some time, and so we expect a pronounced further increase in TPU in the baseline scenario."The firm's trade policy uncertainty indicator for Europe has already risen in recent weeks as markets increasingly priced in odds of a Trump win.The analysts acknowledged, though, that while Trump's 10% across-the-board tariff is a clear risk, they expect his administration to initiate a more moderate set of duties on European countries.Those tariffs will likely target auto exports, which are worth $80 billion, or 0.9% of EU exports, the analysts said. The duties will have large impacts to GDP in Germany, Sweden, and Switzerland in particular, they added. During his campaign, Trump proposed raising tariffs on imports from all countries to <a target="_blank" class="" href="https://www.businessinsider.com/trump-tariff-plan-inflation-policy-impact-trade-war-china-rates-2024-5">at least 10%</a>, and said imports from China would be <a target="_blank" rel="" class="" href="https://www.businessinsider.com/donald-trump-impose-tariffs-china-if-elected-2024-2?utm_medium=ingest&amp;utm_source=markets">subject to even steeper 60% duties</a>.The analysts add that a Trump presidency will prompt European countries to up their defense spending to account for a <a target="_blank" href="https://www.businessinsider.com/how-trump-could-handle-ukraine-war-if-reelected-scenarios-2024-10">potential decrease</a> in US military support to Ukraine. That wartime support will cost the EU another 0.5% of GDP every year, the analysts say.The increased spending won't result in a growth boost, either, they say."Any resulting growth boost, however, will likely be limited by modest military spending multipliers in Europe, upward pressure on long-term yields from higher deficits and negative confidence effects from elevated geo-political risk," the analysts said.European officials have long warned of huge growth impacts from a second Trump presidency.Last month, ECB member Joachim Nagel <a target="_blank" href="https://www.businessinsider.com/trump-win-economic-growth-inflation-risks-europe-ecb-germany-2024-10">warned</a> a Trump win could hammer growth and send inflation soaring in Europe, and back in January, ECB president Christine Lagarde said a Trump win is "clearly a threat" to Europe, pointing to his tariff plans, commitment to NATO, and climate change policies.

Trump's presidency will hurt Europe's economic growth amid renewed trade tensions, Goldman Sachs says

Boost in domestic <keyword id="19914449" type="General" weightage="20" keywordseo="manufacturing" source="keywords">manufacturing</keyword> due to PLI (production linked incentive) schemes and increase in <keyword id="19916774" type="General" weightage="20" keywordseo="exports" source="keywords">exports</keyword> on account of free trade agreements are expected to bridge the country's <keyword id="20201391" type="General" weightage="20" keywordseo="trade-deficit" source="keywords">trade deficit</keyword> further, <keyword id="20613906" type="General" weightage="100" keywordseo="Economic-Survey" source="keywords">Economic Survey</keyword> said on Monday. However, it said that fluctuations in <keyword id="19936629" type="General" weightage="20" keywordseo="commodity-prices" source="keywords">commodity prices</keyword>, especially for critical imports like oil, metals, and agricultural products, can impact India's trade balance and inflation levels. The Survey said that though ongoing geopolitical headwinds impacted India's merchandise exports, lowering international commodity prices ensured a lower trade deficit in FY24 than in FY23. The country's merchandise trade deficit narrowed to USD 240 billion in 2023-24 from USD 265 billion in 2022-23. It added that changes in trade policies by major trading partners or geopolitical developments can affect India's export opportunities and market access. "In the coming years, India's trade deficit is expected to decline further as the <keyword id="19981334" type="General" weightage="20" keywordseo="PLI-scheme" source="keywords">PLI scheme</keyword> is expanded and India creates a globally competitive manufacturing base in several product categories," the Survey said. It added that the recently signed FTAs (free trade agreements) are expected to increase the <keyword id="22374533" type="General" weightage="20" keywordseo="global-market-share" source="keywords">global market share</keyword> of the country's exports. The PLI scheme for sectors like mobile manufacturing, information technology (IT) hardware, pharmaceutical, telecommunications, and food product are helping to increase manufacturing and cut imports. India has implemented <keyword id="20000557" type="General" weightage="20" keywordseo="FTA" source="keywords">FTA</keyword> with Mauritius, Australia and the UAE. It added that a narrowing merchandise trade deficit and rising service exports have improved the CAD (<keyword id="20054874" type="General" weightage="20" keywordseo="current-account-deficit" source="keywords">current account deficit</keyword>), ending with a surplus of 0.6 per cent of GDP in Q4 of FY24. However, the risks to the performance of India's external sector are on the downside due to the persistence of current <keyword id="19955176" type="General" weightage="20" keywordseo="geopolitical-tensions" source="keywords">geopolitical tensions</keyword> and policy uncertainty, it said. Some of the challenges listed by the survey includes fall in demand from major trading partners like the US, rise in trade cost, and volatility in commodity prices. Attacks on shipping in the Red Sea and drought in the Panama Canal have resulted in trade flows being re-routed, increasing journey time and costs. India's merchandise trade relies heavily on maritime trade, so disturbances in major shipping routes can impact its economy. "It is critical to explore what these changing paradigms mean for India. Policies need to be a mix that straddles security concerns with economic considerations," the survey said, adding India's push towards manufacturing in complex and niche sectors through schemes such as PLI and Make in India aims to balance these goals. Further, the survey emphasised on the need to focus on improving India's competitiveness in many product areas. For example, it said, India has tremendous potential in becoming a large global exporter in agricultural commodities. Fostering stronger regional trade ties and adding more markets for Indian goods will help mitigate global demand fluctuations. "In an era when global economic growth is likely to be buffeted by geopolitical tensions and protectionism, growing India's exports of goods and services will be a stiffer challenge than before," it cautioned. Commenting on this, Rumki Majumdar, Economist, Deloitte India, said that despite global uncertainties, India's exports are recording positive growth rates. "That shows the resilience of our exports amidst global uncertainties," she said, adding, "by transforming our export basket and focusing on higher margins and value addition across various sectors, India will easily achieve its ambition of USD 2 trillion in exports by 2030-31."

India's trade deficit expected to decline further: Economic Survey

India’s Chief Economic Advisor (CEA), <keyword id="20690607" type="General" weightage="20" keywordseo="V-Anantha-Nageswaran" source="keywords">V Anantha Nageswaran</keyword>, remains optimistic about the nation’s economic prospects despite a slower-than-expected <keyword id="19972825" type="General" weightage="20" keywordseo="GDP-growth" source="keywords">GDP growth</keyword> in the second quarter of FY2024-25. Speaking at the Bharat @100 Summit hosted by Assocham, he said that the fundamental health of the economy remains robust, according to a report by aNI. Nageswaran highlighted several indicators demonstrating the economy’s resilience. “If you run through the checklist for the <keyword id="19948184" type="General" weightage="100" keywordseo="Indian-economy" source="keywords">Indian economy</keyword>, the health is pretty robust,” he noted, pointing to controlled levels of external debt as a share of GDP, declining non-performing assets in the banking system, and stable inflation trends. Although certain food items have caused inflationary spikes, their impact is limited within the overall consumer price index basket, he explained. The CEA praised the shift in fiscal expenditure priorities over the past seven years, with greater focus on capital investments rather than revenue spending. This reallocation, he suggested, has bolstered long-term economic stability and growth potential. India’s GDP growth for the July-September quarter was 5.4%, significantly below the Reserve Bank of India’s forecast of 7%. While this has sparked concerns among economists, Nageswaran urged against overreacting. Erratic monsoons and excessive rainfall disrupted economic activity in Q2, he explained, while global uncertainties and supply chain pressures further weighed on growth. Despite these challenges, he maintained confidence in the broader growth narrative, citing improvements in key economic metrics. For instance, India’s gross capital formation has risen from 27.3% of GDP in the second decade of the 2000s to 30.8% today. Private consumption remains steady, and exports—spanning both services and manufacturing—continue to perform well even amid challenging global conditions. Nageswaran also underscored India’s growing competitiveness in international trade. He noted that the nation’s total <keyword id="24325087" type="General" weightage="20" keywordseo="exports-as-a-percentage-of-GDP" source="keywords">exports as a percentage of GDP</keyword> now surpass China’s, showcasing its resilience and adaptability in a shifting global trade environment. However, he cautioned against reading too much into quarterly fluctuations, highlighting the impact of geopolitical developments such as trade restrictions from the US on critical minerals and rare earths, as well as policy shifts in China. These external factors, he suggested, are likely to persist and may continue influencing short-term economic trends. (with ANI inputs)

Indian economy is resilient despite Q2 challenges, says CEA Nageswaran

Days after Trump won his way to the White House, becoming the 47th President of the United States, the US Federal Reserve slashed the interest rates by 25 basis points, bringing them within the range of 4.5-4.75%. This is the second time this year that the Fed has lowered the interest rates, after cutting them down by 50 basis points in September 2024. u Fed chair Jerome Powell noted that monetary policy remains tight as inflation remains elevated at 2.4% as of September 2024, slightly above the 2% mark set by the commission. However, the Fed remained optimistic about the current state of the economy. "The Committee seeks to achieve maximum employment and inflation at 2% over the longer run. The Committee judges that the risks to achieving its employment and inflation goals are roughly in balance. The economic outlook is uncertain, and the Committee is attentive to the risks to both sides of its dual mandate," the FOMC (Federal Open Market Committee) noted in its press release. The rate cut was along widely anticipated lines, although experts were wary of the Fed's way ahead, given that Donald Trump has been elected as the US President. In the past, he has, on multiple occasions, expressed his desire to yield greater influence on the Fed, apart from publicly criticizing Powell. However, Powell continued to stand his ground, noting that Trump cannot legally sack him. He believed in keeping the Fed independent, at least until his tenure as governor ends in 2028. He highlighted that even if he is explicitly asked by Trump to quit, he won't do so. <h2>Trump's regime to inch up inflation?</h2> Trump's electoral promises, if translated into policies, could spell disaster for the Fed's effort to curtail inflation. Reportedly, Trump has promised to levy aggressive tariffs against US trading partners, particularly China, and even extend his 2017 tax cuts. This could mean higher levels of the federal deficit, which would push up prices, wages, and hence, inflation, even as the Fed tries to consistently bring it under control. Apurva Sheth, Head of Market Perspectives and Research, SAMCO Securities, notes that it wasn't a surprise when the US Fed cut interest rates by 25 basis points (bps) to 4.75%. The Fed had given enough clues, and the market too had anticipated these rate cuts. "However, what was surprising was how the <keyword id="23863852" type="General" weightage="20" keywordseo="US-10-year-bond-yields" source="keywords">US 10-year bond yields</keyword> moved over the last one and a half months, which have been rising relentlessly from 3.6% to almost 4.5% despite the 50 bps cut in the last Fed meeting. It seems that the market is anticipating slower rate cuts going ahead, and maybe there are even chances of inflation rising. The bond yields have cooled off and slipped below the 4.335% mark. This should be bullish for emerging markets like India," he added.

US Fed cuts interest rates by 25 bps, Powell notes Trump's victory to have no impact on policy decisions

No one's going to sound an alarm, blast out a text message, or shoot you an email about it, but the US economy is undergoing a historic shift. We are leaving one long period of expansion — what economists refer to as a "supercycle" — and entering a very different one.Over the past 15 years, the economy has been characterized by weak demand and low interest rates — a decade-and-a-half hangover from the Great Recession. Now, experts tell me, that is coming to an end. The world has changed, and we are entering an era of higher growth, creeping inflation, and geopolitical instability that will reroute the flow of money around the world. A new era has arrived, but it's going to be bumpy.The good news is that this new era looks as if it will be unencumbered by some of the problems that put a ceiling on growth during the previous era. The most salient feature of the old period, economists say, was the risk of deflation — the possibility that a lack of demand would cause wages and prices to spiral downward, a trap that is <a target="_blank" href="https://www.businessinsider.com/inflation-economy-deflation-unemployment-job-market-recession-outlook-paul-krugman-2024-7">extremely difficult to escape</a>. In an effort to avoid that fate, policymakers in Washington pushed interest rates down to zero and encouraged <a target="_blank" href="https://www.businessinsider.com/softbank-crashing-investments-uber-wework-monopoly-failure-2019-11">all kinds</a> of <a target="_blank" href="https://www.businessinsider.com/charlatans-show-up-when-wall-street-stock-market-gets-weird-2021-3">risky</a> <a target="_blank" href="https://www.businessinsider.com/twilight-of-tech-gods-recession-stock-market-crash-silicon-valley-2022-5">behavior</a> <a target="_blank" href="https://www.businessinsider.com/bill-ackmans-big-pharma-trade-is-making-wall-street-a-super-awkward-place-2014-10">among</a> investors, businesses, and everyday consumers. Investors trying to reach their benchmarks "had to creep out on the risk spectrum," Josh Hirt, a senior economist at Vanguard, tells me. "Supercheap debt," he says, made it easy for businesses to "overexpand and overhire."The pro-risk environment had some earth-shifting consequences. Silicon Valley put the internet on our phones, China blew a massive bubble in its property market, and the world started investing in renewable energy. But low interest rates did little to boost demand, and the economy consistently grew slower than it did before the crash, never notching above 3% GDP growth. It was only after the massive government stimulus, spurred by the pandemic, that the economy reached escape velocity, pushing up wages and starting to grow at a healthy clip.Now, economists say, we're entering a supercycle that will be characterized by three sweeping forces. First, higher interest rates will reward savers, making it more expensive to take risks. Second, geopolitical and economic volatility will generate inflationary effects, reintroducing the specter of soaring prices. And third, industrial planning will be increasingly influenced by national-security concerns, altering supply chains across industries. How low interest rates wind up settling will establish a new gravitational pull in global markets, recalibrating the forces that determine where the economy is most likely to grow — and where investment is most likely to flow.The new supercycle "puts the economy in a completely new era," says Silas Myers, the CEO of Mar Vista Investments, which oversees $4 billion in assets. He warns that an entire generation of investors, lenders, and entrepreneurs have failed to embrace the "profound impact" that the new economic era will have on their businesses."We were in a time that was less demanding and more forgiving," Myers says. "But that time is ending."One of the clearest signs that a new economic supercycle has arrived is when the financial rules go topsy-turvy. The previous supercycle was ushered in when the Federal Reserve, in response to the destruction caused by the financial crisis, cut its benchmark interest rate to 0% — the first time the central bank went all the way to the bottom.The structural shift sent shockwaves throughout the world. Yields on Treasury bonds tanked, meaning investors had to start taking some serious risks if they wanted to make money. This new adventurism pushed stocks higher and higher. Capital went flying into China and other emerging markets in record amounts — some $1 trillion in 2010 alone. Venture capitalists sank billions into companies like Juicero and <a target="_blank" href="https://www.businessinsider.com/wework-adam-neumann-apartment-startup-investment-silicon-valley-vc-apocalypse-2022-8">WeWork</a> that had no viable plan to turn a profit. And with interest rates so low, companies could suddenly load up on debt: From 2007 to 2017, global nonfinancial corporate debt doubled, to $66 trillion. Until the pandemic hit, inflation and wage growth both remained below 3.9%. The world had changed. Now, with the arrival of a new supercycle, money managers are once again being forced to adapt to a changing set of economic realities. Normally, when the Fed hikes interest rates rapidly, the stock market tanks. But that's no longer true. From 2022 to 2024, as the benchmark federal funds rate shot up to 5.5% from 0.5%, the Nasdaq 100 and the S&amp;P 500 soared by 23% and 22%. Higher interest rates also failed to spur widespread layoffs or crater the economy. <a target="_blank" href="https://www.businessinsider.com/jobs-report-labor-market-hiring-layoffs-quits-recession-sahm-rule-2024-8">Unemployment has stayed below 4.3%</a>, and GDP growth has remained solid, <a target="_blank" href="https://www.businessinsider.com/gdp-gross-domestic-product-second-quarter-2024-us-economy-2024-7">defying fears of a recession</a>. In short, something has scrambled the natural interactions of the marketplace. It's as if you put your hand over a hot stove and your fingers turned ice cold.One explanation for the economy's topsy-turvy behavior is a change in what economists call the neutral interest rate — the optimal point for encouraging growth without triggering inflation. After the financial crisis in 2008, the economy was so weak that the neutral rate went to zero to encourage money to flow more freely. But now the market's weird nature may be signaling that the neutral rate has risen above the Fed's ideal target of 2%. That would explain why the Fed's higher rates are no longer putting the brakes on growth. Fueled by the post-pandemic government stimulus, the economy's baseline has shifted. Over at Vanguard, Hirt and his colleagues predict that the neutral rate will stay higher for the foreseeable future, eventually settling at about 3.5%."Even if we do dip below 3.5%, the Fed will be anchored at that higher rate," Hirt says. "If the economy were to experience weakness and we have to cut rates, we still don't think that means taking rates back to zero."Unless you're a boomer, you've probably never experienced a world with this high a neutral rate. It changes the nature of risk, which changes what people decide to do with money on micro and macro levels. If you can get a decent return parking your money in ultrasafe government debt, why risk investing it in a startup or stomach the stock market's volatility? This isn't to say no one will be out here taking risks with their cash — it will just flow in different directions. That's because consumers are in a better place now than they were in the era that emerged after the Great Recession.The economy is "an extraordinarily diverse and dynamic animal," Joe Quinlan, the chief market strategist at Bank of America, assured clients in a recent note. It's "a $28 trillion hydra-headed behemoth that beats to the tune of many different sectors." As the Fed's higher rates were putting a strain on rate-sensitive sectors like housing — which makes up 16% of the economy — Big Tech and travel-starved households were spending money fast and loose. The experience showed that overall consumption can continue to rise even when significant swaths of the economy are struggling.So what can we expect from the new economic supercycle? Like every cycle, it will have its upsides and downsides. Rising interest rates will make loans more expensive, forcing businesses to make more-thoughtful decisions about debt. But they'll also boost savings accounts and interest income. In addition, a faster-growing economy will tighten the labor market, empowering workers to continue to fight for a larger slice of the pie. Since 2019, the bottom 10% of earners have seen a wage increase of 13%.Shifting away from the "grow at all costs" mindset of the previous supercycle has also incentivized governments — especially in the developed world — to do more to police markets and protect consumers. Whether it's capping the price of drugs or enforcing antitrust rules more aggressively, polls suggest Americans want to see <a target="_blank" href="https://prospect.org/economy/2024-08-27-polling-voters-action-corporate-power/">more limits</a> on <a target="_blank" href="https://today.yougov.com/economy/articles/47798-most-americans-oppose-monopolies-and-support-antitrust-laws">corporate power</a> and <a target="_blank" href="https://www.pewresearch.org/short-reads/2021/07/20/56-of-americans-support-more-regulation-of-major-technology-companies/">more regulation</a> to safeguard citizens. For the first time in years, the Federal Trade Commission has begun going after pharmaceutical middlemen, opposing mergers between grocery giants, and taking big swings at Big Tech.The new supercycle will also have profound consequences worldwide, upending how and where money is most likely to flow. In China, the debt bubble that formed in the property sector during the previous cycle is sucking cash away from <a target="_blank" href="https://www.businessinsider.com/china-xi-jinping-stimulus-plan-wall-street-stock-market-economy-2024-9">businesses and households</a>, undermining China's bid to become the world's leading economic superpower. And with Europe growing more slowly than the US, foreign investors are steering more of their money to America. In the second quarter of this year, foreign investors owned $8.2 trillion worth of US Treasury bonds, up by 7.3% from a year earlier. Foreign investment is also soaring in US corporate bonds (up by 9.8%) and US equities (up by 23%). Quinlan says he expects the US economy to continue outperforming the rest of the world, given the fiscal and demographic challenges facing the European Union, Japan, and China. In an era of increasing instability, when former sources of growth are flailing, the United States is widely viewed as the safest place to find returns."Not lost on investors is the fact that the US economy remains among the most competitive, innovative, and resilient in the world," Quinlan wrote in a recent note to investors. "Aerospace or agriculture, energy or entertainment, transportation or technology, goods or services — pick any sector or activity, and there's a good chance the US leads the rest of the world. All of this has helped fuel demand among foreign investors for US securities of all stripes." America's economic diversification is also expected to give it a leg up in one of the most volatile features of the new era: trade conflict. The US and China are already battling for control over critical industries like <a target="_blank" href="https://www.businessinsider.com/china-xi-jiinping-future-tech-global-economy-semiconductors-military-failing-2022-9">semiconductors</a>, <a target="_blank" href="https://www.businessinsider.com/china-crushing-us-america-battle-energy-evs-batteries-tech-war-2023-5">batteries</a>, and <a target="_blank" href="https://www.businessinsider.com/china-xi-jinping-crush-tesla-elon-musk-american-ev-industry-2024-2">electric cars</a> — and the tit for tat will be especially costly for less diversified economies. Germany's dependence on manufacturing, for example, places its most essential industries on a collision course with China's ambitions. And while the United States is well positioned to weather the storm, that doesn't mean it won't be rough. The world has never faced a challenge like the skyrocketing flow of exports from China up and down the value chain. It's a dynamic that threatens to imbalance international trade by flooding the market with cheap goods of all kinds. <a target="_blank" href="https://www.businessinsider.com/china-shock-explainer-us-economy-trade-dumping-supply-glut-yellen-2024-4">China Shock 2.0</a> "will not go down easily," Quinlan tells me.For over a decade we have become accustomed to the economy working a certain way — if this, then that. As a new supercycle emerges, investors, businesses, and governments that structured themselves around the old model may experience acute shocks. To succeed in this unfamiliar new world, they'll have to adjust their expectations and find ways to harness the supercycle's opportunities. It's the economic equivalent of natural selection: As the economy evolves, those who adapt will be most likely to survive. The days of economic growth are back. The future belongs to those who can grow with it.<a target="_blank" rel="" href="https://www.businessinsider.com/author/linette-lopez">Linette Lopez</a> is a senior correspondent at Business Insider.

America is entering a new 'economic supercycle'

<ul class="summary-list"><li>Indexes were mixed but mostly higher Thursday as traders took in economic data and Nvidia's earnings. </li><li>US GDP grew at a slightly higher pace in the second quarter than initially reported. </li></ul>US stocks were mixed Thursday as investors digested a post-earnings fall in Nvidia shares despite the AI giant's earnings beat.The Dow Jones Industrial Average rose more than 200 points, paring gains after being up more the 400 points earlier in the session. The index still managed to hit a fresh record high, while Nvidia's 6% decline weighed on the S&amp;P 500 and the Nasdaq.Positive economic data helped the market power past Nvidia's big drop, with US GDP growth getting an upward revision for the second quarter. The economy grew 3% last quarter compared to the initially reported 2.8%. Jobless claims data, meanwhile, were about in-line with the previous week, falling by 2,000 to 231,000.Nvidia's drop in the session came as the hotly anticipated earnings after the closing bell on Wednesday narrowly missed the <a target="_blank" class="" href="https://www.businessinsider.com/nvidia-q2-earnings-ai-investors-expectations-2024-8">high end of expectations</a>. With the stock already trading not far from record highs and the hype soaring going into the earnings call, investors balked at the slightly narrower earnings beat compared to previous quarters. On Friday, investors will get the latest reading of the personal consumption expenditures index, the Federal Reserve's preferred inflation gauge. The index is expected to show inflation rose in-line with the prior month at 2.5%. Here's where US indexes stood at the 4 p.m. closing bell on Thursday:<ul><li><a target="_blank" href="https://markets.businessinsider.com/index/s&amp;p_500?utm_source=markets&amp;utm_medium=ingest%3Futm_source%3Dmarkets&amp;utm_medium=ingest&amp;utm_medium=ingest&amp;utm_source=markets&amp;utm_medium=ingest&amp;utm_source=markets">S&amp;P 500</a>: 5,591.96, down 0.001%</li><li><a target="_blank" href="https://markets.businessinsider.com/index/dow_jones?utm_source=markets&amp;utm_medium=ingest%3Futm_source%3Dmarkets&amp;utm_medium=ingest&amp;utm_medium=ingest&amp;utm_source=markets&amp;utm_medium=ingest&amp;utm_source=markets">Dow Jones Industrial Average</a>: 41,335.05, up 0.59% (+243.63 points)</li><li><a target="_blank" href="https://markets.businessinsider.com/index/nasdaq_composite?utm_source=markets&amp;utm_medium=ingest%3Futm_source%3Dmarkets&amp;utm_medium=ingest&amp;utm_medium=ingest&amp;utm_source=markets&amp;utm_medium=ingest&amp;utm_source=markets">Nasdaq composite</a>: 17,516.43, down 0.23%</li></ul>Here's what else happened today:<ul><li>Wall Street says Nvidia's post-earnings dip is <a target="_blank" class="" href="https://markets.businessinsider.com/news/stocks/nvidia-stock-price-outlook-buy-q2-earnings-decline-wall-street-2024-8">an 'invitation' to buy</a> the stock, analysts say. </li><li>Apple will <a target="_blank" class="" href="https://markets.businessinsider.com/news/stocks/nvidia-vs-apple-top-ai-stock-iphone16-device-chips-citi-2024-8">eclipse Nvidia as the top AI stock in 2025</a>, as the AI cycle shifts from infrastructure to devices, Citi says. </li><li>Mortgage rates are falling, but <a target="_blank" class="" href="https://www.businessinsider.com/mortgage-rates-nar-real-estate-agent-buyers-home-prices-redfin-2024-8">buyers are still on the sidelines</a>. Here's why. </li></ul>In commodities, bonds, and crypto:<ul><li>Oil futures rose.<a target="_blank" href="https://markets.businessinsider.com/commodities/oil-price?utm_medium=ingest&amp;utm_source=markets"> West Texas Intermediate</a> crude oil rose 1.8% to $75.89 a barrel. <a target="_blank" href="https://markets.businessinsider.com/commodities/oil-price?utm_medium=ingest&amp;utm_source=markets">Brent crude</a>, the international benchmark, rose 1.7% to $80 a barrel.</li><li><a target="_blank" href="https://markets.businessinsider.com/commodities/gold-price?utm_medium=ingest&amp;utm_source=markets">Gold</a> traded higher at $2,555.40 an ounce.</li><li>The 10-year Treasury yield rose two basis points to 3.865%.</li><li><a target="_blank" href="https://markets.businessinsider.com/currencies/btc-usd?utm_medium=ingest&amp;utm_source=markets">Bitcoin</a> edged up 0.5% to $59,462. </li></ul>

You Searched For "trading economics" and got 8 results

FDIs may shift to US under Trump 2.0 but it is unlikely to severely impact FDIs inflow to India, says SBI Report

Ira Alok Puranik

FPIs withdraw nearly Rs 20,000 crore from equities in the last 5 trading sessions, make a beeline for China and US

BI India Bureau

Trump's presidency will hurt Europe's economic growth amid renewed trade tensions, Goldman Sachs says

Kelly Cloonan

India's trade deficit expected to decline further: Economic Survey

PTI

Indian economy is resilient despite Q2 challenges, says CEA Nageswaran

BI India Bureau

US Fed cuts interest rates by 25 bps, Powell notes Trump's victory to have no impact on policy decisions

Ira Alok Puranik

America is entering a new 'economic supercycle'

Linette Lopez

Stock market today: US stocks trade mixed as investors weigh economic data and Nvidia's post-earnings dip

Kelly Cloonan

Popular Keywords

Buying Guides