Donald Trump would not risk breaking his promise to Americans to improve the cost of living in the United States by raising tariffs, said the head of investment management firm Frank Investments.

Trump has said he wants to raise tariffs by 10% on goods imported from around the world, and up to 60% on goods from China, as part of his plan to protect American industries.

An increase in tariffs would lead to higher inflation rates, meaning Trump would be less likely to cut prices as he had promised voters, Paul Sedgwick told Sky News.

“I think it’s fair to say that Donald Trump is a negotiator. And I personally think he takes a negotiating stance,” he says.

“He believes in the fact that he wants to see the rest of the world buy more American products. He wants to see productivity in America increase and he wants to have some sort of negotiation with the rest of the world around us.

“Does he want to start a trade war, or does he want to suddenly find that he’s imposing tariffs on the rest of the world and they start fighting back? This drives up inflation rates. This hampers growth and has a negative impact. on the global economy.

“Personally, I don’t see it. I don’t think it’s in his interest. When he campaigns, he talks about the impact of inflation on ordinary households in America.

“The last thing he wants to do is try to push prices back up to that level. Personally, I think it’s a negotiating tactic.”

What could the implications be for the UK?

Mr Sedgwick says that when the US economy does well, it also reflects well on the UK economy across the Atlantic.

In the “worst case scenario,” high inflation in the United States would fail to generate growth and slow the economy. Mr Sedgwick said this would make it much harder for Chancellor Rachel Reeves to achieve her ambitions.

“But, as I’ve said before, I’m sure Trump wants to continue to have good relations with the UK, to work with the UK on a trade basis and has already talked about trade deals in the past,” he adds. .