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Trade tensions and interest rates

Year: 2026

Type: article

Abstract: Trade Tensions and Interest Rates. Abstract: In an era of escalating trade tensions, this paper explores the theoretical interplay between trade policies, such as tariffs, and interest rate decisions. It examines how tariffs might influence inflation, demand, and global dynamics, shaping central bank responses and affecting economic stability. Drawing on economic principles rather than empirical data, the paper delves into key channels such as inflation and demand and the policy dilemmas that arise. It concludes that trade policies can nudge interest rates in unpredictable ways, with broader implications for economic outcomes. The paper suggests future discussions on how central banks might adapt when trade wars challenge monetary control.

Source: Zenodo (CERN European Organization for Nuclear Research)

DOI: 10.5281/zenodo.19066316

Author: Chaoufi, Taha

Language: English

Topic: Monetary Policy and Economic Impact

Subfield: General Economics, Econometrics and Finance

Field: Economics, Econometrics and Finance

Domain: Social Sciences

Open Access status: green

OpenAlex ID: W7138453487

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