Reported 12 months ago
Investors are betting on Trump's return to the White House and his push for tax cuts, driving up fiscal deficits and inflation, causing long bond yields in the United States to soar. Fed Chair Powell's dovish remarks at the ECB monetary policy meeting signaled progress in fighting inflation, leading to a slight drop in the 10-year Treasury yield from its recent high but still remaining elevated. Analysts warn that Trump's proposed policies may create economic uncertainty, exacerbate inflation, and hinder economic growth, prompting firms like Morgan Stanley and Barclays to advise clients to prepare for potential outcomes. Goldman Sachs analysts suggest that regardless of the election results, there may not be a significant difference in fiscal deficits, especially considering the negative impact Trump's tariff hikes could have on the economy and bond yields.
Source: YAHOO