Economists in the News | EM Monthly: Turbulence Ahead | APAC Credit Outlook | Trump 2.0 and US Corporates | US Holiday Sales Outlook

Welcome to the latest edition of Essential Economics! We continue to report on the likely macro and credit impacts of the US election. Louis Kuijs hit the airways this week to break down the latest Chinese stimulus proposals as well as the likely impact of US President-elect Trump’s proposed tariffs. Luca Rossi, Valerijs Rezvijs and our emerging markets team write that following the U.S. elections, we are closely monitoring tighter financial conditions and a stronger dollar. Eunice Tan and team report that U.S. President-elect Donald Trump's historic win will color Asia-Pacific's credit landscape and that the region’s issuers will be tested in 2025. In the wake of the US election, our US corporate teams argue that a lower corporate tax rate of 15% would reduce a company's tax expense and boost the cash available to service debt. Finally, Laruen Slade expects US holiday sales growth will slow to about 3% in 2024 from 4.7% last year, remaining below the 10-year average.

Louis Kuijs Discusses China on CNBC

Louis appeared on CNBC TV18 (India) to discuss our take on China’s recently announced measures to support? local governments, banks recapitalization and household consumption against the backdrop of likely tariffs from the incoming US Trump administration.

To watch the interview, click here .

EM Monthly: Turbulence Ahead Post-US Election

Luca, Valerijs and team write that following the U.S. elections, we are closely monitoring the potential impact on emerging markets (EM) of tighter financial conditions and a stronger dollar. Potential policy changes may weigh on EM growth and heighten credit vulnerabilities.

EM currencies have depreciated sharply after the U.S. elections.

To access the EM monthly chart pack, click here .

APAC Credit Outlook: Cutting Through the Noise

Eunice and team report that U.S. President-elect Donald Trump's historic win will color Asia-Pacific's credit landscape. While still unknown, prospective trade and foreign policy could renew tensions between the U.S. and China, and that may hit trade-oriented Asia-Pacific.

The region's issuers will be tested as they navigate policy and market volatility through 2025.

To read the full report, click here .

Trump Tax Proposals and US Corporates

Our analysts across sectors argue that a lower corporate tax rate of 15% would reduce a company's tax expense and boost the cash available to service debt, all else being equal. In addition, it could incentivize other companies to reduce their business activities overseas. The second- and third-order effects from any tax cuts are difficult to predict at this stage because the rely on many other variables.

Making permanent the Tax Cuts and Jobs Act corporate tax deductions that expire in 2025 will generally benefit companies' net income and boost post-tax cash flow.

To read the full report, click here.

US Holiday 2024 Sales Outlook: Trimming Ahead

Lauren and team expect US holiday sales growth will slow to about 3% in 2024 from 4.7% last year, remaining below the 10-year average of 5.3%. Value perception will separate retailers, and we expect those with the right merchandise at the right price will emerge as winners this holiday season.

We expect retailers' margins will remain steady because of broad cost-savings initiatives implemented throughout the year.

To read the full report, click here .

?

?

As always, you can find the latest research from the S&P Global Ratings Economics team here .