In His Second Year, Trump Imposes a New Global Economic Reality

16 January 2026, US, Washington: US President Donald Trump attends a rural health investment roundtable in the East Room of the White House. Photo: Andrew Leyden/ZUMA Press Wire/dpa
16 January 2026, US, Washington: US President Donald Trump attends a rural health investment roundtable in the East Room of the White House. Photo: Andrew Leyden/ZUMA Press Wire/dpa
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In His Second Year, Trump Imposes a New Global Economic Reality

16 January 2026, US, Washington: US President Donald Trump attends a rural health investment roundtable in the East Room of the White House. Photo: Andrew Leyden/ZUMA Press Wire/dpa
16 January 2026, US, Washington: US President Donald Trump attends a rural health investment roundtable in the East Room of the White House. Photo: Andrew Leyden/ZUMA Press Wire/dpa

On Tuesday, US President Donald Trump completes his first year in the White House - a year marked by the adoption of a strict protectionist approach and accelerated financial policies that caused shocks in global markets and reshaped international trade balances. As the administration moves into its second year, structural liberation from institutional constraints is emerging, with a trend towards enhancing the expansion of presidential powers through unilateral decisions, which raises the intensity of geopolitical risks and deepens the division in the political and economic landscape of the United States.

Radical Change

Upon his triumphant return to power on January 20, 2025, Trump pledged to reshape the economy, the federal bureaucracy, and immigration policies. Indeed, he implemented a large part of this agenda, becoming one of the most powerful presidents in modern American history. His radical economic measures included downsizing the federal administration, abolishing government agencies, reducing foreign aid, and imposing comprehensive tariffs that sparked global trade tensions. He also passed a massive tax package and sought to restrict some vaccines, while continuing to pressure academic, legal, and media institutions, focusing on his domestic economic priorities.

Centralization of Power and Challenging Monetary Independence

In recent weeks, Trump revived his controversial plan to acquire Greenland and threatened military force against Iran, ignoring concerns about the criminal investigation into Federal Reserve Chairman Jerome Powell. In an interview with Reuters last week, Trump showed no concern about the potential economic repercussions of pressuring Powell, stating, "I don't care." In remarks to the New York Times, he said the only constraint he has as commander-in-chief is "his personal ethics," reflecting his philosophy of governance that prioritizes personal judgment over institutional constraints.

Inflation and Popularity Test

Despite his insistence that the current economy is the "strongest" in history, Trump faces increasing popular pressure due to inflationary pressures and persistent price increases, which is the biggest challenge before the midterm elections in November. His efforts to reduce the cost of living are complicated by conflicting messages about inflation, which he sometimes described as a "Democratic hoax." Analysts believe that excessive focus on foreign affairs may weaken the effectiveness of his domestic economic policies even as Trump plans to conduct field tours to promote his plan to address high prices.

Shift in Economic Decision-Making

From an executive standpoint, Trump has invested executive orders and emergency declarations to shift the weight of economic decision-making from Congress to the White House. These policies are based on the support of the conservative majority in the Supreme Court, Republican control of the House of Representatives, and the loyalty of his ministerial team, which gives him exceptional ability to implement without much obstruction. Economic historians describe this influence as unprecedented since the era of Franklin Roosevelt (1933-1945), who enjoyed broad popular and legislative support to confront the Great Depression, while Trump exercises his current authority amid sharp division in public opinion.

Political Indicators and November Risks

According to a Reuters/Ipsos poll, Trump's approval rating was 41 percent, compared to 58 percent disapproval, which is a relatively low number for American presidents. Democratic strategist Alex Floyd warned that "ignoring the controls of the rule of law" could cost Republicans in the ballot box. For his part, Trump acknowledged to Reuters the risk of losing control of Congress in the November election, warning his party that a Democratic majority could mean facing impeachment for the third time.

First Year Assessment

During his first year, Trump reduced the size of the federal civilian workforce, shut agencies, reduced humanitarian aid, issued orders for widespread immigration raids, and even sent the National Guard to cities run by Democratic authorities. Economically, he ignited trade wars by imposing tariffs on goods from most countries, passed a law to cut taxes and spending, continued to prosecute his political opponents, and canceled or restricted access to some vaccines, and attacked universities, law firms, and media.

Despite promising to end Russia's war in Ukraine from day one of taking office, Trump has made little progress towards a peace agreement, while claiming to have ended eight wars, a claim widely disputed, given the continuing conflicts in several parts of the world.

Expectations for the Next Stage

Presidential historian Timothy Naftali said that Trump exercised his executive powers during his second term with fewer restrictions than any president since Roosevelt. In the early years of Roosevelt's presidency, the Democratic president enjoyed a large majority in Congress, which allowed him to pass most of his domestic agenda to expand the scope of government without significant resistance. He also enjoyed broad popular support for his efforts to deal with the Great Depression, while the Republican opposition was fragmented and weak.

Analysts from the Republican Party point out that Trump's difficulty in convincing voters that he is aware of their living challenges, especially with the high cost of living, may push some Republican representatives to distance themselves from him to ensure they maintain their seats in the midterm elections.

An analysis of the trajectory of Trump's current policies shows that he has increased the power of the executive presidency at a rare rate, transforming most of the economic and political decision-making process to the Oval Office, while limiting the influence of Congress and institutional controls. However, erratic economic policies and his perceived "distracted" speeches have worried some Republican strategists, who fear that his focus on foreign issues will cost him voters.



Iraq Studies Alternative Options for Oil Exports

Floating oil export loading platforms at the Basra Oil Port, Iraq, March 12, 2026. REUTERS/Mohammed Aty
Floating oil export loading platforms at the Basra Oil Port, Iraq, March 12, 2026. REUTERS/Mohammed Aty
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Iraq Studies Alternative Options for Oil Exports

Floating oil export loading platforms at the Basra Oil Port, Iraq, March 12, 2026. REUTERS/Mohammed Aty
Floating oil export loading platforms at the Basra Oil Port, Iraq, March 12, 2026. REUTERS/Mohammed Aty

Iraq is studying alternative measures to export crude oil after disruptions to the process amid the US-Israeli war against Iran. At the same time, the country intends to continue producing crude oil at a level of 1.4 million barrels per day.

Iraqi Oil Minister Hayyan Abdul Ghani told the official television channel Al-Iraqiya News that oil exports account for 90 percent of Iraq’s revenues, and that the ministry has decided to continue producing crude oil at 1.4 million barrels per day.

He emphasized that the production and supply of petroleum products to meet domestic demand have not stopped.

He added that refineries are operating at full design capacity to cover local needs, and that sufficient quantities of liquefied gas are available to fully meet domestic needs.

Regarding exports, he explained that the export process has stopped in the south, prompting the government to search for possible alternatives to export crude oil. He revealed that an agreement is close to being signed to export oil through the Turkish Ceyhan pipeline.

Abdul Ghani added that the ministry has prepared a comprehensive plan to manage the current phase, particularly after the new circumstances in the Strait of Hormuz, noting that a plan has been activated to transport 200,000 barrels per day by tanker trucks through Türkiye, Syria, and Jordan.

In a separate context, the oil minister denied that tankers targeted in Iraqi waters belonged to Iraq, explaining that they were not Iraqi vessels and were carrying naphtha.

Iraq recently lost its entire oil export capacity of 3.35 million barrels per day after Iran closed the Strait of Hormuz following escalating conflict in the region.

Iraq relies on crude oil sales for about 95 percent of its revenues to meet the needs of the country’s annual federal budget. This means that the country would face a critical situation if the conflict in the Gulf region and the Strait of Hormuz continues.


Gold Set for Weekly Drop as Oil Price Surge Weighs on Rate-cut Hopes

FILE PHOTO: A goldsmith weighs gold jewelry inside a showroom in Ahmedabad, India, July 31, 2025. REUTERS/Amit Dave/File Photo
FILE PHOTO: A goldsmith weighs gold jewelry inside a showroom in Ahmedabad, India, July 31, 2025. REUTERS/Amit Dave/File Photo
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Gold Set for Weekly Drop as Oil Price Surge Weighs on Rate-cut Hopes

FILE PHOTO: A goldsmith weighs gold jewelry inside a showroom in Ahmedabad, India, July 31, 2025. REUTERS/Amit Dave/File Photo
FILE PHOTO: A goldsmith weighs gold jewelry inside a showroom in Ahmedabad, India, July 31, 2025. REUTERS/Amit Dave/File Photo

Gold prices were on track for a second consecutive weekly drop, despite edging up on Friday, as surging energy prices due to the Middle East war dimmed prospects for near-term US interest rate cuts.

Spot gold was up 0.3% at $5,095.55 per ounce, as of 0633 GMT on Friday. US gold futures for April delivery fell 0.1% to $5,100.20.

The US 10-year Treasury yields eased, increasing the appeal of the non-yielding bullion. Bullion, however, has ‌lost more ‌than 1% so far this week. Since the war ‌started ⁠on February 28, ⁠it has dropped over 3% so far.

Fears of inflation and questions about the Federal Reserve's ability to cut interest rates if high oil prices persist are somewhat counteracting gold's appeal, said Tim Waterer, KCM Trade chief market analyst.

"Given the ongoing uncertainty about the duration and scope of the conflict in the Middle East, I expect gold to remain on the ⁠radar for investors as a safety play." Heightening geopolitical ‌tensions, Iran's Supreme Leader Mojtaba Khamenei said ‌on Thursday that Tehran will keep the strategic Strait of Hormuz closed as ‌leverage against the US and Israel, which has stoked concerns about ‌global energy supply and risk assets.

Oil prices rose above $100 a barrel, as attacks on oil tankers in the Gulf and warnings from Iran shattered prospects of quick de-escalation in the Middle East conflict. As oil prices surged, US President Donald ‌Trump again demanded Fed Chair Jerome Powell cut interest rates.

Traders, however, expect the Fed to keep rates ⁠steady in the current ⁠3.5%-3.75% range at the end of its two-day meeting on March 18, according to CME Group's FedWatch tool. While recent inflation data suggest price growth is under control, the war and the resulting spike in crude prices have yet to filter through the data.

Investors are awaiting the release of the delayed January Personal Consumption Expenditures Index, expected on Friday. Gold discounts in India widened this week to their deepest point in nearly a decade as demand stayed subdued and some traders steered clear of paying import duties, while the escalating Middle East war boosted safe-haven demand in China.

Spot silver was down 1% at $82.91 per ounce. Spot platinum lost 1% to $2,111.45 and palladium fell 1% to $1,603.


Iran War and Rising Fuel Costs Could Boost Panama Canal Traffic, Administrator Says

A cargo ship sails under Las Americas bridge through the Panama Canal, in Panama City, Thursday, March 12, 2026. (AP)
A cargo ship sails under Las Americas bridge through the Panama Canal, in Panama City, Thursday, March 12, 2026. (AP)
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Iran War and Rising Fuel Costs Could Boost Panama Canal Traffic, Administrator Says

A cargo ship sails under Las Americas bridge through the Panama Canal, in Panama City, Thursday, March 12, 2026. (AP)
A cargo ship sails under Las Americas bridge through the Panama Canal, in Panama City, Thursday, March 12, 2026. (AP)

Panama Canal Administrator Ricaurte Vásquez said Thursday that the conflict in the Middle East and rising fuel costs could ultimately benefit the interoceanic waterway as global shippers adjust routes.

In an interview with The Associated Press, Vásquez said that higher energy, fuel and navigation costs could make the Panama Canal a more attractive option for commercial traffic.

“When costs increase, in general when the price of marine fuel rises, the Panama Canal becomes a more attractive route,” Vásquez said.

Oil prices have risen amid the war in the Middle East, which has led to the temporary closure of the Strait of Hormuz by Iran in response to US and Israeli attacks. About one-fifth of the world’s oil passes through the waterway at the mouth of the Gulf.

If higher energy costs persist, routing cargo through Panama can cut voyages by between three and 15 days, depending on the route, while reducing fuel consumption, he said.

Vásquez said higher fuel costs are expected to affect container ships, bulk carriers and tankers transporting liquefied natural gas. If Middle Eastern supplies are disrupted, shipments may be replaced by other sources, including the United States, which could redirect some LNG cargo from Europe to Asia via Panama.

Gerardo Bósquez, an executive with the Panama Maritime Chamber, said a prolonged conflict could reshape global trade routes, with gas transport among the segments likely to benefit.

Vásquez cautioned that any changes will not be immediate and will depend on how long cargo operators expect the conflict and instability in the Gulf last.