The swift financial market response to Donald Trump's return to the White House reflects anticipations of tax cuts and trade tariffs, leading to a volatile economic outlook.
Most economists predict that Trump's economic policies, even if modified, will be detrimental to growth in the US and globally, possibly increasing consumer prices.
The expectation of prolonged higher US borrowing costs has resulted in a strengthened dollar and increased market optimism for corporate profits, despite potential negative impacts.
While financial markets expect a minor rate cut from the Federal Reserve, ongoing inflation concerns could lead to a more cautious approach to future cuts.
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