The Bank for International Settlements (BIS) has warned that U.S. President Donald Trump’s trade war and deregulation plans could disrupt financial stability, fuel inflation, and increase market volatility, posing challenges for global central banks.
The Bank for International Settlements (BIS) has issued its first public warning about the risks posed by Donald Trump’s economic policies, citing trade tensions, financial deregulation, and fiscal uncertainty as key threats to global stability.
Speaking in Mexico City, BIS chief Agustin Carstens highlighted the growing concerns among central bankers, stating that Trump’s approach to trade, fiscal policy, and immigration could trigger economic disruptions.
“Such pervasive policy uncertainty will affect central banks in several ways,” Carstens said, warning that market instability could worsen.
🔹 Slower Economic Growth – Businesses may delay investment and households could hold off on major purchases due to policy unpredictability.
🔹 Market Volatility – Currency fluctuations and asset price swings are expected to intensify as investors navigate tariff disputes with Canada, Mexico, and China.
🔹 Rising Inflation – A weaker currency and financial turbulence could drive up inflation, forcing central banks to intervene.
🔹 Debt Risks – Loose fiscal policies could lead to higher debt levels, potentially destabilizing global financial markets.
Carstens also warned of a widening gap between U.S. and global interest rates, driven by America’s stronger economic performance compared to other major economies. If this trend continues, it could disrupt capital flows, weaken foreign currencies, and create imbalances in global financial conditions.
“An abrupt repricing of public debt could put financial stability at risk,” Carstens cautioned, raising concerns about potential debt crises in emerging markets.
Trump’s deregulation agenda has sparked fears of a weakened financial oversight system, particularly in Europe, where regulators worry about a global race to loosen financial supervision.
While the BIS has traditionally refrained from direct political criticism, its latest warning reflects the growing unease among global central banks as they attempt to navigate the uncertainty of Trump’s second term.
As financial leaders prepare for upcoming policy decisions, the lasting impact of Trump’s economic strategy remains uncertain, but the warning from the world’s top central bank body signals that the stakes are higher than ever.
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U.S. Vice President JD Vance met with senior Vatican officials on Saturday for talks that the Vatican described as "cordial," following ongoing criticisms of the Trump administration’s policies, particularly regarding immigration.
Russian President Vladimir Putin announced a temporary ceasefire in Ukraine for Easter, set to last from 6 p.m. Moscow time (1500 GMT) on Saturday until midnight (2100 GMT) following Easter Sunday.
U.S. President Donald Trump announced on Friday his plan to reclassify approximately 50,000 federal workers under a new category, "Schedule Policy/Career," which would make it easier to fire civil servants who do not align with his administration's policy agenda.
The U.S. Supreme Court issued an order early Saturday blocking the deportation of alleged Venezuelan gang members from Texas under the Alien Enemies Act, a wartime law from 1798.
Despite U.S. President Donald Trump’s reluctance to support military action, Israel has not ruled out launching a limited strike on Iran's nuclear facilities in the coming months, according to Israeli and other sources familiar with the matter.
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