Even if Donald Trump eases tariffs, markets aren’t safe, warns hedge fund titan Paul Tudor Jones in dire economic forecast

Billionaire investor Paul Tudor Jones has issued a dire warning to investors, that US stock markets might not be out of danger yet, as stocks might fall to new lows, even if US president Donald Trump backtracks on his steep tariffs on China, as per a report.

Paul Tudor Jones Warns of Potential Market Lows Despite

During an interview on CNBC's Squawk Box, the Tudor Investment Corp founder presented a dire market forecast, saying, "For me, it's pretty clear, Trump's locked in on tariffs. The Fed's locked in on not cutting rates," adding, "That's not good for the stock market," quoted Daily Mail.

The warning from the hedge fund billionaire comes after the global markets were in turmoil, following US president Donald Trump’s unexpected rollout of some of the highest import tariffs in decades, reported Daily Mail.

Market Volatility Persists Amid Tariff Uncertainty

Although the S&P 500 has managed a modest rebound, it’s still about 8% below its record high, and Jones doesn’t believe the worst is over yet, as per the report. In his view, the market still hasn’t hit bottom, according to Daily Mail.

Trump’s tariffs, which soared as high as 145% on Chinese goods, sparked immediate retaliation from Beijing, with counter-tariffs reaching up to 125% on US goods, as per the report. While China has since signalled that it’s open to negotiations, Jones isn’t convinced it’s enough to undo the damage, according to Daily Mail.

Jones emphasized that, "He'll dial it back to 50 percent or 40 percent, whatever, it'd still be the largest tax hikes since the 1960s — you can take 2, 3 percent off growth," quoted Daily Mail.

Federal Reserve's Stance Adds to Market Concerns

While the Federal Reserve has kept interest rates unchanged since December, and the central bank's Chair Jerome Powell has indicated a wait-and-see approach before any changes, reported Daily Mail.

He highlighted that, "Unless they get really dovishand really, really cut, you’re probably gonna go to new lows,' Jones said. 'And then when we’re new lows, the hard day will start to follow, and it’ll probably create the Fed to move, create Trump to move. And then we’ll get some kind of reality," as quoted in the report.

FAQs

How have global trade tensions affected the market?
Ongoing trade tensions have led to market volatility and investor uncertainty, as per reports.

What is the Federal Reserve's current approach to interest rates?
The Federal Reserve has maintained interest rates without significant cuts, which Jones believes adds to the market's challenges, as per Daily Mail.