As the U.S. presidential election approaches, the potential outcomes could have significant implications for both the domestic economy and international relations, particularly in Asia. Recent analyses indicate that Vice President Kamala Harris is in a competitive race against former President Donald Trump, with national polling showing them nearly tied. Harris has gained momentum, particularly among voters concerned about abortion rights, which may favor Democrats in the upcoming election [c2a06d0b].
A report from Desjardins Group suggests that a Harris victory would positively impact the U.S. economy, with real GDP growth projected to be slightly better than the current baseline. This growth is expected to be driven by expanded child and earned-income tax credits, which would boost disposable income for lower-income households [74283b47]. Conversely, a Trump win could lead to a 2% decrease in real GDP due to anticipated higher tariffs, anti-immigrant policies, and inflation affecting consumer spending [74283b47].
Harris's campaign has been bolstered by enthusiastic volunteer support and a fundraising advantage over Trump, suggesting a strong grassroots effort [c2a06d0b]. However, Trump maintains an edge on key issues such as the economy and immigration, which could sway undecided voters [c2a06d0b]. If elected, Harris is expected to continue many of President Biden's policies, while Trump has promised aggressive tariffs that could disrupt global trade [c2a06d0b].
The U.S. economy, currently facing a $28 trillion debt, is projected to slow down but remain resilient in the face of these political changes. Moody's predicts a rising debt-to-GDP ratio, indicating potential fiscal challenges ahead [c2a06d0b]. Moreover, the Federal Reserve is unlikely to implement aggressive rate cuts, which could further complicate economic conditions [c2a06d0b].
In terms of energy, U.S. oil production is expected to rise by 500,000 barrels per day in 2025, which may influence global oil markets and pricing [c2a06d0b]. As Asia navigates these developments, it must prepare for a volatile U.S. political landscape that could impact trade, economic stability, and international relations in the region [c2a06d0b].
Both candidates' policies will shape the U.S.'s role in global affairs, with Harris likely promoting a continuation of the current administration's approach, while Trump's policies could lead to increased protectionism and tariffs, affecting trade dynamics with Asian economies [c2a06d0b]. The outcome of the election will not only determine the future of U.S. domestic policy but also set the tone for international relations and economic interactions with Asia in the coming years.