Former US president Donald Trump, despite being the target of an assassination attempt, is gaining popularity as the presidential race intensifies. Predictions favor Trump to win the election, with odds rising to 65%, while Joe Biden’s chances have fallen to 20%. Financial markets are reflecting the possibility of a second Trump term, with a potential shift in economic policies.
US bond markets are responding to the prospect of a Trump victory, impacting long-term yields. Investors are also positioning for a Trump win by rallying the US dollar and energy stocks. Cryptocurrencies are also on the rise due to political uncertainties in the US.
However, the economic and geopolitical implications of a second Trump presidency remain largely unexplored. Concerns about Federal Reserve policies, potential trade wars with China, and market volatility loom large. Investors are urged to consider the far-reaching effects of a Trump re-election on global markets.
Despite the uncertainties, markets are still reaching new highs, indicating a lack of seriousness surrounding the implications of a second Trump term.
Nicholas Spiro is a partner at Lauressa Advisory