The Republican candidate won the US presidency after winning the swing state of Wisconsin, which pushed him over the threshold. By early morning, Trump had won 279 electoral votes compared to Harris's 223, and several states had not yet been counted.
Republican presidential nominee Donald Trump retook the White House on Wednesday by securing more than the 270 Electoral College votes needed to win the presidency, according to Edison Research forecasts.
His Republican Party also won control of the Senate and could even win the House of Representatives, making it easier for the president to legislate his proposals and push through key appointments.
Trump's victory in the US presidential race will have economic consequences for the rest of the world that are likely to be profound and quite immediate.
If Trump enacts just a fraction of his promises — from higher trade tariffs to deregulation, more oil drilling and more demands on America’s NATO partners — the strain on public finances, inflation, economic growth and interest rates will be felt in every corner of the world.
"Trump's fiscal promises are seriously problematic – for the US economy and for global financial markets – as they promise to vastly widen an already excessive deficit while threatening to undermine key institutions," said Erik Nielsen, chief economic adviser at UniCredit Group.
"One must conclude that Trump poses a serious — and so far vastly underestimated — threat to the U.S. Treasury market and, therefore, to global financial stability," Nielsen said.
Import duties, including a universal 10% tariff on imports from all foreign countries and a 60% tariff on imports from China, are a key pillar of Trump's policies and are likely to have the biggest global impact.
Tariffs inhibit global trade, reduce exporters' growth and weigh on the public finances of all parties involved. They are likely to raise inflation in the United States, forcing the US Federal Reserve to take a more restrictive monetary policy.
The International Monetary Fund has already described global growth as weak, with expansion in most countries "weak." A further hit to global trade could pose a downside risk to its forecast of 3.2% GDP growth for next year.
Companies typically pass on import costs to customers, so tariffs are likely to be inflationary for American buyers, forcing the Federal Reserve to keep interest rates high for longer or even reverse course and raise borrowing costs again.
That will be even more likely if Trump follows through on his spending and tax promises, which could increase the U.S. debt by $7.75 trillion by 2035, according to the nonpartisan Committee for a Responsible Federal Budget.
"Most of the damage would be done under a universal import tariff," said Rogier Quaedvlieg of ABN Amro. "If the final implementation is not universal, the hit to the global economy would be significantly more moderate."
"Trump's full package, including a universal package, would likely hit the global economy hard."
CHINA AND MEXICO IN THE SPOTLIGHT
For emerging markets that rely on dollar funding, such a policy mix will make borrowing more expensive, dealing a double whammy in addition to lost exports.
The same forces that could push up U.S. inflation could weigh on prices elsewhere, especially if Trump slaps massive tariffs on China, as he has promised.
As the world's largest exporter, China is desperate to revive growth, so it may seek new markets for squeezed goods outside the United States and dump products elsewhere, especially Europe.
Central banks are likely to react quickly as business confidence, especially in open, trade-dependent economies, will deteriorate rapidly.
"Even before a drop in polls, the ECB might be tempted to accelerate its rate cuts to a neutral rate of 2%, and once US tariff policies become clearer, it would be reasonable to cut rates below the neutral rate," said Greg Fuzesi of JP Morgan.
Governments are also likely to retaliate against any US tariffs, which would further inhibit trade and further reduce global growth.
Higher Fed interest rates and lower borrowing costs elsewhere would also boost the dollar – as evidenced by the 1.5% drop in the value of the euro and yen overnight – further hurting emerging markets, as more than 60% of global debt is denominated in dollars.
Mexico could be the hardest hit given Trump's rhetoric on border closures, which comes amid an already deteriorating domestic context.
"Mexico is the most at risk," said Jon Harrison of TS Lombard, as the Mexican peso fell 3 percent against the dollar.
Mexico is especially vulnerable because trade tensions and threats of deportations could exacerbate domestic problems such as cartel activity and the government's failure to curb violence, Harrison added.
Among the potential winners, Brazil could enjoy increased trade with China, given that Beijing replaced all of its imports of U.S. soybeans with Brazilian ones when trade tensions erupted during Trump's first presidency.
But Europe could also suffer the added blow of rising defence costs if Trump reduces support for NATO.
The continent has been dependent on the US military presence since the end of World War II and, with no end in sight to Russia's war in Ukraine, Europe will be forced to fill any void left by an American withdrawal.
But public debt in Europe is already approaching 90% of GDP, so finances are stretched to the limit and governments will struggle to stimulate an economy suffering from trade barriers while also financing military spending.
Trump's deregulatory efforts are likely to drag on for some time to come, but internationally agreed proposals to make banks more resilient, known as Basel III, could be among the first casualties.
The new rules will apply from January 1 and policymakers are already debating whether to continue even if the US withdraws.
