The Monocle Minute

Whoever wins the White House in November will face a changing US economy. So far, it has shown resilience against rising interest rates and global uncertainty. But inflation volatility is becoming the new normal, with more frequent supply shocks and structural labour shortages. Policies that boost demand (such as tax cuts) or target supply (such as tariff hikes) could reignite inflation faster, forcing the Federal Reserve to hike interest rates yet again.

But the big question is: what happens to global trade after November? Donald Trump’s first term marked a decisive turning point in US policy and, once again, higher tariffs are the centrepiece of his campaign. Realistically, if he wins a second term, tariffs on Chinese imports are likely to increase from 2.5 per cent to 4.5 per cent, rather than the 10 per cent promised. But that would still eat into US growth and could increase inflation by about 3.5 per cent. This, in turn, would force the Federal Reserve to hit the brakes on its easing cycle, leaving rates stuck at a steep 4.5 per cent in 2025. But a Kamala Harris victory wouldn’t end protectionism, either. The Biden administration’s generous industrial subsidies are protectionism by another name and they aren’t going anywhere if she wins.

Another concern is climate change. Interestingly, the two main candidates have similar goals when it comes to their energy agendas: reducing costs, decreasing foreign dependencies and improving US manufacturing and production. Where they differ is in how they plan to achieve their targets. Under Harris, tightening climate regulation and continued support for clean energy would accelerate the phase-out of fossil fuels. Trump, on the other hand, wants to promote fossil fuels. While this will not stop the industry’s long-term decline, it would delay the transition to renewables. So a Trump victory could significantly slow down the progress of the global green transition, fragmenting the planet’s response and incurring a much steeper economic cost.

Ludovic Subran is the chief economist of Allianz in Munich. For more opinion, analysis and insight, subscribe to Monocle today.

Japan’s ruling Liberal Democratic Party (LDP) was left reeling after a dismal showing in Sunday’s general election, losing its majority in the 465-seat lower house for the first time in 15 years. The LDP and its junior coalition partner, Komeito, claimed 215 seats – a loss of 64, and well below the 233 needed to form a government. The main opposition group, the Constitutional Democratic Party of Japan, won 148 seats, up from 98 previously.

The prime minister, Shigeru Ishiba, called the snap election days after taking office on 1 October, arguing that it was the best way to draw a line under the scandals that have engulfed his party in recent years. But instead of reaffirming the LDP’s mandate, voters punished the party, angry at these scandals and the failure to tackle the increased cost of living. The elected parties now have 30 days to form a government. At a press conference yesterday, Ishiba pledged that he would stay in office – though the LDP might have other ideas. In one piece of good news, a record 73 women were elected, surpassing the previous high of 54 in 2009.

Warsaw has announced plans to combine 41 towns into one “supercity”, creating a new metropolitan region. With a projected population of 2.1 million and an area of about 2,500 sq km, it will exceed both London and Rome in size. The purpose of the plan is “to facilitate tax collection”, says Mateusz Mazzini, writer at large for Gazeta Wyborcza. “But some towns are poorer than others so a unified tax system might require people to chip in for those who can’t afford to do so.”

That complication will be a key line of argument for those who oppose the plan, Mazzini tells Monocle Radio’s The Globalist. Yet the supercity will bring clear benefits. “The coal-mining industry led to significant political and economic growth in the region but it’s no longer profitable. The evolution of different cities into a single agglomeration will accelerate a transition to green energy and prevent those in the coal sector from losing their livelihoods by pivoting to renewable practices.”

For more on Poland’s plans for a new supercity, tune in to Monday’s edition of ‘The Globalist’ on Monocle Radio.

In September, former Aesop executive Daniel Bense launched To My Ships, his line of natural deodorants and perfumes. The London-based brand is part of the increasingly lucrative personal-care industry, which was valued at $21.8bn (€19.9bn) in 2023. Bense tells Monocle about demand in a crowded market and lessons learnt from his time at Aesop.

How do you ensure that your products will stand out?
Our focus is on how the product is experienced by the customer. Packaging plays an important role. We worked with Formafantasma to design our bottles and boxes. The studio’s thoughtful approach resonated with our own values.

What’s your approach to product development?
It’s only worth creating quality products that are effective and a pleasure to use. Naturally, we started at the beginning with a well-defined brief. The goal is to offer an uplifting experience.

Is there still demand for new luxury cosmetics brands?
Yes, there will always be space for brands that aspire to do things better than those that came before them.

How did your experience at Aesop help this project?
I basically had an apprenticeship in balancing creative vision with commercial success in a high-growth, high-touch business.

This interview features inMonocle’s November issue, which is out now. For more unlikely finds and agenda-setting stories on business and retail from our global network of reporters, pick up your copy now.

We head to Rome to find out about a new film dedicated to the Women’s Liberation Movement in the 1970s before visiting one of the world’s largest contemporary art foundries in Walla Walla. Plus: an interview with French pop star Zaho de Sagazan.