Trump’s protectionist policies will hurt global growth, economists warn

Good morning and happy New Year. Here are today’s highlights:

• A warning about the impact of Trump’s protectionist policies

• US authorities investigate an “act of terrorism” in New Orleans

• Africa’s newest stock exchange prepares to open

• Ten tips to get your personal finances into shape

Donald Trump’s vision to reshape the world’s largest economy through protectionist policies that put “America First” will damage growth, according to economists polled by the Financial Times, in contrast to investors who believe the US president-elect’s plans are good for the economy.

Surveys of more than 220 economists in the US, UK and Eurozone on the economic impact of Trump’s return to the White House showed most respondents believed his protectionist shift would overshadow the benefits of what the president-elect has dubbed “Maganomics”.

Many economists in the US, who were polled jointly by the FT and the University of Chicago’s Booth School of Business, also believe a new Trump term will spur inflation and lead to more caution from the Federal Reserve on cutting interest rates.

However, most economists — including at the IMF, the OECD and the European Commission — forecast stronger growth in the US than in Europe in 2025.

Overall, more than half of the 47 economists polled specifically on the US economy expect “some negative impact” from the Trump agenda, and another tenth forecast a “large negative impact”. On the other hand, a fifth of those surveyed expect a positive impact.

The gloom among economists contrasts with investors’ optimism over Trump’s second term. Read the full results of the survey.

We will be publishing a special edition of FirstFT Americas in the run-up to Donald Trump’s inauguration and we need your help. Please email any questions you have about the incoming administration to firstft@ft.com and remember to include your name and location details for publication. Also, there is a subscriber-only webinar on January 23 to discuss what Trump’s return to the White House means for America and the world. Register for free here.

Five more top stories

1. The FBI is investigating an “act of terrorism” after a man drove a pick-up truck into a large crowd in the heart of New Orleans yesterday. The agency identified Shamsud-Din Jabbar, a 42-year-old US citizen from Texas, as the main suspect and said it did not believe he acted alone. US President Joe Biden said authorities were also investigating the explosion of a Tesla Cybertruck outside the Trump hotel in Las Vegas to see if the two incidents were related. Here’s more on the twin investigations.

2. Nvidia invested $1bn in artificial intelligence companies in 2024, as it emerged as a crucial backer of start-ups trying to gain from the AI revolution the group’s chips are powering. The semiconductor group, which surpassed a $3tn market capitalisation in June, spent a total of $1bn across 50 start-up funding rounds and several corporate deals in 2024. Read more on Nvidia’s investments.

3. Banks are on course to generate their highest annual trading revenues since 2010, according to estimates from Coalition Greenwich, an industry research group. The industry is expected to bring in almost $225bn in trading revenues in 2024 as volatility around the US election and the unwinding of the so-called yen carry trade helped bolster business.

4. European scientists have started work on a project to create simple forms of life from scratch in the lab by using inanimate chemicals that they hope will divide and show “Darwinian evolution” within six years. The “MiniLife” project is sponsored by the European Research Council and plans to capitalise on theoretical and experimental advances in the fast-growing field of synthetic biology. Read more about how the project works.

5. Russian gas flows through Ukraine stopped in the early hours of yesterday after a transit deal between the two countries expired in the wake of Moscow’s full-scale invasion. The pipeline was one of the last two routes still carrying Russian gas to Europe, nearly three years into the full-scale war. EU countries will lose about 5 per cent of gas imports in the middle of winter.

What to watch in 2025

Financial Times reporters consider the rise of “sovereign” artificial intelligence, whether the “masters of the universe” will be investing your pension savings and the threat looming over the luxury goods sector, in our survey of business trends to watch in the year ahead.

We’re also reading . . . 

• ‘The mother of all stress tests’: Donald Trump has consistently vowed to use the tools of US justice to settle scores with enemies. He should be taken literally as well as seriously, writes our editorial board.

• Crypto’s golden era: The sector expects lighter regulation and wider adoption under Donald Trump, but some worry about systemic risks.

• Financial to-do list: From money-saving work perks to investments and tax planning, Claer Barrett has 10 tips to get your finances in shape this new year.

Chart of the day

Later this month Ethiopia will open its first stock market since the last days of emperor Haile Selassie, a milestone for one of the poorest countries on Earth. The opening of the Addis Ababa exchange is part of efforts by Prime Minister Abiy Ahmed to modernise the economy of Africa’s second-most populous nation following a devastating civil war that killed at least 600,000 people.

Take a break from the news

The FT’s critics pick the most anticipated hot tickets in 2025, from film, theatre, dance and TV to art exhibitions, games, pop and classical music.