Trump’s trade turbulence rattles markets, CEOs and global allies amid ‘golden age’ push

US President Donald Trump’s aggressive and unpredictable tariff agenda has shaken markets, alarmed corporate leaders, and stirred tensions with global allies, threatening the very economic optimism he heralded just a month into office as the beginning of a “golden age of America”, the Wall Street Journal reported.

At a February investor conference in Miami, Trump touted record market highs and surging indexes. But by March, a wave of volatility erased $4 trillion in S&P 500 value, undermining confidence amid escalating tariff threats, global instability, and sliding consumer sentiment.

Markets stumble as policy whipsaws
While Wall Street initially embraced Trump’s promises of growth and deregulation, many CEOs and investors now face a dramatically different landscape. Conflicting signals from the White House—particularly around tariffs on Canada, Mexico, and China—have injected uncertainty, clouding forecasts and cooling expectations for a merger and acquisition (M&A) boom.

Deal volume has fallen despite high hopes among financiers, and even Trump’s own economic officials now concede tariffs may fuel inflation and weaken growth. Consumer sentiment hit its lowest point since January 2021, and the Federal Reserve has paused rate cuts amid concerns about “tariff inflation.”

Tariffs spark domestic and international fallout
Trump’s vow to impose reciprocal tariffs on April 2 is unsettling both domestic industries and trading partners. CEOs of automakers warned that 25% tariffs on goods from Canada and Mexico could cripple U.S. manufacturing supply chains, a point raised directly in tense calls with Trump.

Meanwhile, Germany’s €1 trillion defence investment in response to Trump’s foreign policy unpredictability has raised sovereign bond yields and chilled European demand for US Treasurys.

“The attitude was, ‘This is going to be an exceptionally pro-growth agenda.’ All of that has gone in reverse,” said Ed Al-Hussainy, global strategist at Columbia Threadneedle Investments.

Trump shrugs off recession concerns
Despite mounting pressure, Trump remains defiant. “Everything could happen,” he said when asked about a recession, maintaining that tariffs would ultimately flood the U.S. with wealth. Treasury Secretary Scott Bessent echoed the sentiment, dismissing concerns over corporate profits and calling for a “detox period” from years of high spending and cheap imports.

But other voices within Trump’s circle—like former economic adviser Larry Kudlow and former VP Mike Pence’s aide Marc Short—warn that the administration is risking long-term damage by prioritizing trade disruptions over immediate pro-growth reforms.

Executives unsettled, hiring slows
Business leaders are showing signs of hesitation. A Federal Reserve survey showed a sharp drop in optimism among manufacturing firms, and hiring has slowed amid a sense of “helplessness” among executives facing volatile policy shifts.

“There’s an overriding sense of helplessness,” said Sean West, co-founder of Hence Technologies. “CEOs are feeling stunned, and they’re not used to feeling like they don’t have good moves.”

Even private equity leaders, who were once hopeful of a Trump-fuelled M&A revival, now say falling interest rates—not deregulation—would have a greater impact on deal volume.

Internal contradictions widen
Trump’s team has delivered mixed messages on nearly every major policy front. While the White House pushes deregulation to offset tariff costs, companies warn the math doesn’t add up. Ford CEO Jim Farley and GM’s Mary Barra both raised concerns, with Barra noting that U.S. investment won’t matter if cross-border costs explode.

The administration has wavered publicly on the scope and timing of the April 2 tariffs, creating confusion on Wall Street and Capitol Hill.

Golden age or growing pain?
Still, Trump insists the nation is on the right path. “You’re going to see billions of dollars, even trillions, coming into our country very soon, in the form of tariffs,” he said Tuesday, brushing off critics and touting the longer-term payoff of his policies.

But as stock markets reel, businesses retreat, and economic warnings multiply, many analysts fear the “golden age” Trump proclaimed could give way to self-inflicted economic turmoil.