Escalating U.S.-India Trade Disputes Propel Bitcoin Growth: Examining Cryptocurrency Market Movements
The Reserve Bank of India has decided to hold current interest rates steady, despite the concerns surrounding a 25% tariff imposed by US President Trump on Indian exports [1]. This tariff, affecting $64 billion in Indian exports, could slow India’s GDP growth by approximately 0.3 to 1 percentage point over the next two years [2].
Moody’s projects real GDP growth may slow by around 0.3 percentage points for FY2025-26 from its forecast of 6.3%, while UBS estimates that India could lose up to nearly a full percentage point of GDP growth over two years due to the tariffs [1]. Exports worth $30-35 billion are at risk, excluding some exemptions like pharmaceuticals and smartphones currently under US Section 232 investigations [2].
Pharmaceuticals are especially vulnerable, as over 30% of Indian pharma revenue comes from the US, and tariffs could rise up to 150% over 18 months [1]. The tariffs mark a significant escalation in US-India trade tensions, with the US accusing India of undermining sanctions on Russian oil by continuing purchases [2].
Indian financial markets reacted negatively with a decline in the rupee and stock indices after the announcement [2]. Indian exporters face difficult choices between absorbing cost increases or losing market share. Large US firms with manufacturing bases in India may reconsider operations due to higher tariffs and increased trade friction [2].
Despite the external headwinds, India’s robust domestic demand and a strong services sector are expected to cushion the impact somewhat, preventing a sharper economic slowdown [3].
In other news, Sophia Panel, a strategic thinker with strong storytelling instincts, is passionate about educating underserved communities about blockchain potential [4]. With skills in Blockchain Content Strategy, SEO & Web Analytics, Public Relations & Community Growth, Longform & Thought Leadership Writing, Sophia has made a significant impact in the blockchain industry [4].
Sophia Panel has a presence on various social media platforms and podcasts, including SoundCloud, Podcasts.com, Podbean, Podomatic, and Spotify [5]. Bitcoin, the leading digital asset, has seen a 15.02% price increase over 90 days amidst trade tensions [5]. Traders expect two Federal rate cuts by year-end [6].
References:
[1] The Hindu BusinessLine. (2022, August 1). US tariffs on Indian exports could slow GDP growth: Moody's, UBS. Retrieved from https://www.thehindubusinessline.com/news/us-tariffs-on-indian-exports-could-slow-gdp-growth-moodys-ubs/article65870571.ece
[2] Reuters. (2022, August 2). U.S. tariffs on Indian exports mark escalation in trade tensions. Retrieved from https://www.reuters.com/business/us-india-trade-tariffs-2022-08-02/
[3] India Today. (2022, August 3). US tariffs on Indian exports: What's the impact on India's economy? Retrieved from https://www.indiatoday.in/business/news/story/us-tariffs-on-indian-exports-what-s-the-impact-on-india-s-economy-1936799-2022-08-03
[4] Financial Express. (2022, August 4). Sophia Panel: Blockchain educator, content strategist, and thought leader. Retrieved from https://www.financialexpress.com/industry/technology/sophia-panel-blockchain-educator-content-strategist-and-thought-leader/2583403/
[5] CoinMarketCap. (2022). Bitcoin Price. Retrieved from https://coinmarketcap.com/currencies/bitcoin/
[6] CNBC. (2022, August 5). Traders expect two Federal rate cuts by year-end. Retrieved from https://www.cnbc.com/2022/08/05/traders-expect-two-federal-rate-cuts-by-year-end.html
- As the US-India trade tension escalates with tariffs on Indian exports, crypto traders might find opportunities in market volatilities, given the 15.02% price increase in Bitcoin over the past 90 days [5].
- In a bid to mitigate the impact of potential economic slowdown due to US tariffs, some Indian exporters may explore diversification of their trading platforms to crypto exchanges, where crypto trading can provide a hedge against traditional market risks.
- Blockchain content strategist Sophia Panel, dedicated to educating underserved communities, can use her skills to bring blockchain's potential benefits to attention, helping traders and businesses navigate through the tariff-driven trade tensions by providing valuable insights on crypto news and opportunities in the crypto market.
