On May 6, 2025, U.S. President Donald Trump convened the Fifa Task Force to a summit at the White House. It was his comments on trade deals that took center stage and received all the glory. His comments led to a historic self-correction of U.S. stock markets, spooking investors and analysts as well. The convening in Washington, D.C. was meant to address critical international trade issues. President Trump’s overt and aggressive trade policy came in and stole the show and overshadowed all those discussions.
On Tuesday, that fear was unleashed by Trump’s trade rhetoric, which sent financial markets reeling. The S&P 500 was down 0.77%. At the same time, the Dow Jones Industrial Average fell by 0.95%, and the Nasdaq Composite Index closed down 0.87%. Investors were spooked by his claim that the U.S. has no need to enter into trade agreements. He stated, “And you know what? We don’t have to sign agreements — they have to sign agreements with us.” They want a piece of our market. We aren’t even interested in a slice of their market. This comment contradicted earlier claims by top White House officials that securing trade agreements was a primary focus of the administration.
As analysts have pointed out, one overlooked effect of Trump’s tariffs is that they’re helping to push other countries to deepen their economic relationships with each other. As we noted previously, relations with the U.S. have deteriorated in Canada and other key Trump travel ban countries. The recent visit from Bank of England Governor Mark Carney provided a unique opportunity to reset our unsettled bilateral relationship. This important relationship has been fraught with difficulty since January.
As JPMorgan’s Mislav Matejka put it, something big is afoot on the global economic landscape. He reiterated that the U.S. is “not a good place to hide.” This view suggests that the relevance of U.S. exceptionalism is waning. One area that both sides have taken steps to improve is despite, or perhaps in response to, the increasing trade tensions.
Given that background, it may be hard to believe that Trump’s administration has been the most influential force in reworking international trade alliances and supply chains. His tariffs have wreaked havoc on U.S. markets. The answer is bilateral— Britain, on a roll after Brexit, and India, an emerging powerhouse as it seeks to establish itself on the world stage. The stakes are high, both as countries adjust to the complicated transformation being wrought by U.S. trade policy.
U.S. Treasury Secretary Scott Bessent will be discussing these developments with his Chinese counterparts this week in Switzerland. They’ll take on urgent economic and trade issues. OPIC’s new meeting will undoubtedly be critical in cutting through the confusion that has resulted from the previous administration’s approach to international trade.