对于“川普2.0”的政策顺序，国内外分析师看法不一：Analysis suggests that tariff policies are at the forefront, followed by deregulation which will also be implemented quickly. Tax reduction and industrial policies come later, with high uncertainty in the implementation of immigration policies. In terms of policy implementation difficulty, trade, diplomacy, and environment are lower than tax reduction, with immigration reform posing the greatest difficulty.
Yesterday, Trump has secured victory, and the Republican Party also has a high probability of 'sweeping' Congress, the current market focus shifts to the implementation sequence of 'Trump 2.0' policies, which will impact the direction of global financial markets.
During the campaign, Trump repeatedly promoted his policy proposals, mainly including four aspects: imposing tariffs on foreign goods, reducing domestic taxes, supporting traditional energy, and opposing immigration policies. Policy changes have far-reaching implications, as the market generally believes that the combination of Trump's policies will raise inflation and affect the Federal Reserve's interest rate decisions.
Regarding the sequence of 'Trump 2.0' policies, domestic and foreign analysts have differing views:
China Merchants Macro Research predicts that anti-immigration and tariff policies come first, followed by tax cuts and industrial policies.
CICC believes that tariff policies may be implemented more quickly under certain conditions, while the implementation of tax cuts domestically may be delayed, and there is high uncertainty about the implementation of immigration policies.
Morgan Stanley suggests that tariffs may be the first to be rolled out, followed by immigration policies, and fiscal policies may be the last to be implemented due to the time-consuming legislative process.
In terms of the difficulty of policy implementation, Huaxi Macro Research points out that topics such as trade, diplomacy, environment < tax cuts < immigration reform that require legislative overhaul.
Trump's nine major policy proposals vary in implementation difficulty.
Huaxi Macro summarized Trump's nine major policy proposals, among which four aspects have a significant impact on the economy:
Tariffs: Trump demands levying tariffs of at least 10% to 20% on all imported goods, and imposing tariffs as high as 60% or more on goods imported from China.
Taxation: Trump promises to extend tax cuts passed during his first term (set to expire at the end of next year), and further reduce corporate income tax.
Immigration: Trump promises the largest-ever illegal immigration expulsion action in history.
Energy: Trump chants the slogan "increase oil production", promises to reduce regulations on oil, natural gas, and coal production, and provide more federal land for fossil fuel production.
Huaxi Macro indicates that overall, the feasibility of Trump's policies depends mainly on the need for congressional cooperation. In terms of difficulty, presidential executive orders < can use reconciliation procedures budget bills < encounter procedural obstacles and other bills requiring 60 votes to end debate. Specifically regarding Trump's campaign proposals, the difficulty of implementation is: trade, foreign affairs, environment < tax cuts < immigration reform and other issues requiring new legislation.
Merchants Macro: Antimigration and tariff policies come first, followed by tax cuts and industrial policies.
CICC Macro Analysis suggests that anti-immigration and tariff policies come first, followed by tax cuts and industrial policies.
First, the anti-immigration policy may be prioritized for economic stress testing and flexibility, and Trump can also shift the blame to the Democratic Party government.
Second, the tariff policy may be on the agenda, but the actual implementation time is still unknown. Historically, there is usually a period of more than half a year reserved for investigation, negotiation, and consultations, so it will not happen overnight. The impact of tariffs on US inflation and domestic exports will only be reflected after they are actually implemented.
Third, the introduction of tax reduction policy may lag behind the first two major policies. The Republican Party platform indicates that as tariff revenue increases, tax reduction policies will naturally follow. This implies imposing tariffs first and then reducing income taxes.
Driving energy supply release, but the implementation path is uncertain.
CICC Macro reminds to pay attention to the subsequent important time points and variables. November to December will enter the new presidential transition period, during which Trump can use this time to form the cabinet, streamline personnel and institutions. Trump's inaugural speech on January 20th and a series of executive orders that may be issued from late January to early February next year are important windows to observe Trump's governance direction. If the Republican Party fails to win the House of Representatives, Trump's governance space will inevitably be constrained, but the probability of this situation is currently very low.
CICC: Tariff policies may land faster under conditions, while internal tax cuts will take effect later.
CICC also indicates:
Internal tax cuts are the strongest policy to support economic growth in the election platform, but the implementation may be delayed and result in high debt pressure, suppressing long-term economic growth prospects. Referring to the advancement process of the 2017 tax reform act, Trump's tax reduction policy needs to go through legal procedures, taking about 1 year from proposal to implementation. Additionally, many policies in this round of tax cuts are used to extend the tax reduction laws originally set to expire in December 2025. Therefore, this round of tax reduction policy may not boost economic growth until 2026.
Tariff policies may land faster under certain conditions and could create significant 'stagflation' pressure on the economy. Trump proposed imposing a 60% comprehensive tariff on China and a 10% comprehensive tariff on other countries during the election. The implementation of this policy may happen relatively quicker. We believe that if this policy is implemented quickly, it will have a noticeable 'stagflation' effect on the economy. According to the median estimate by overseas institutions, if the taxes announced by Trump during the election are imposed, it could drag down the US GDP growth rate by about 1 percentage point in 2025, while pushing up US inflation by about 1.4 percentage points.
Deporting illegal immigrants could also have a similar 'stagflation' effect, but the uncertainty of policy implementation is higher. If illegal immigrants are deported, it will reduce labor market supply, increasing wage inflation. Rising wages will lead to higher production costs, suppressing economic growth.
Morgan Stanley: Tariffs First, Fiscal Policy Last
Morgan Stanley analysis points out:
1. Given the broad discretionary power of the US president in trade policy, as well as Trump's expressed intentions in the election information and his first term precedent, tariff changes may happen first.
2. Major fiscal policy changes require control of both houses of Congress, and even in the case of a big victory for the Republican Party, legislation will take time, so it may be implemented last among the three categories. Due to the lack of implementation details in immigration policy, the timing is also unclear.
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