Tariffs could disrupt the US supply chain, leading to inflation and higher interest rates, which would negatively impact the initial public offerings (IPO) market, according to Drew Bernstein, co-chairman of MarcumAsia.
In a recent interview, Bernstein explained that tariffs imposed on imports can increase costs for businesses and consumers. “If supply chains are disrupted by tariffs, it will drive up prices, leading to inflation,” he said. “This inflation can prompt the Federal Reserve to raise interest rates, which is bad news for the IPO market.”
Higher interest rates make borrowing more expensive, which can deter companies from going public. “When interest rates rise, it becomes more costly for companies to finance growth,” Bernstein noted. “This makes the IPO market less attractive, especially for emerging companies.”
Bernstein emphasized the interconnectedness of global trade and its impact on financial markets. He urged policymakers to consider the broader economic implications of tariffs. “It’s important to understand how tariffs can ripple through the economy and affect markets like IPOs,” he said.
