A probable domestic weakening of the President of the United States, Donald Trump, should have an inverse effect on the boldness of his international advances. The reading made by the managing director of Americas at Eurasia Group, Christopher Garman, is that protectionism should set the tone for American domestic policy — and throughout the world.
“The more Trump weakens domestically, the bolder his advances abroad will be. One is related to the other,” Garman said in Outliers InfoMoney 2026 Awards. He points out that the assessment of Americans, today essentially concerned with the issue of the cost of living, about the president’s recent ventures outside the country is still low.
The assessment is that the president is likely to face defeat in the midterm elections this year, with more Democratic Party candidates being elected. Instead of preventing further actions by Trump, this movement should reinforce, in the short term, investments in regions such as Iran and Europe.
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Iran, Europe and the escalation of geopolitical risk
“Our reading is that the possibility of more aggressive military action in Iran is increasing. What we are beginning to see is an ambition to decapitate the regime,” he says.
For Garman, this can be justified, on the one hand, by the influence of the Israeli Prime Minister, Benjamin Netanyahu, stimulated by the fragility of the Iranian regime; and, on the other, due to the assessment of its success in capturing President Nicolás Maduro.
On another front, the director believes that tensions with Europe following threats — including the use of force —: “We cannot underestimate this. It is a historic ally, a threat to the sovereignty of an allied country.”
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Faced with a trend of disapproval in domestic politics, Trump should invest in measures to alleviate the cost of living, such as the proposal to limit interest on credit cards already defended by the president, as well as continued pressure against the Federal Reserve (American central bank) and interventions in the real estate market.
“We don’t have a vision of where the global dollar is going, but everything we see on the geopolitical side tends to reinforce a scenario of a weaker dollar. Of course, it will not lose its status as a global reserve currency, but it exacerbates this trend that we have seen in the last month”, said Garman.
If the United States has its economic challenges, allies on the Old Continent do too. In addition to the productivity and dynamism challenges faced by the European economy, what is imposed on the bloc is a cycle of disapproval of incumbents in the three main countries — France, the United Kingdom and Germany — and the growth of right-wing populist parties. “The ‘union’ of the European Union is falling apart. We are more concerned today than in recent years,” Garman said.
After the transition point marked by Trump’s offensives against the bloc, Garman analyzes, the diagnosis that the region cannot depend on the United States in terms of weapons and military spending became more evident. Recent events also served as a push towards the implementation of agreements such as those made with India and Mercosur.
If the short term holds a possible worsening of tensions on one side, on the other, Eurasia sees a cooling of the dispute between the United States and China. “If there was a major miscalculation by the Trump administration, it was underestimating the bargaining power of the Chinese over the American economy, looking at the issue of rare earths,” points out Garman.
According to the analyst, Trump is even more willing to reach an agreement than close allies within the government. “We think there will be some type of agreement to normalize the relationship. Tariffs should fall. It should involve the purchase of American agribusiness products, eliminate restrictions on technological transfers. We should see a detox of the bilateral relationship”, says Garman.
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What is Brazil’s place?
Middle powers may have the potential to better navigate a more protectionist world. Based on this thesis, Brazil may be well positioned, despite an “Achilles heel” on fiscal issues and high interest rates.
“Despite this, it is a rising agro power, a rising energy power. With an increase in oil production, 90% clean energy, the second largest global reserve of rare earths. These assets will grow in value in the context of countries seeking resilience in them”, says Garman.
