Degroof Petercam: Trump’s victory leads to a number of uncertainties
The Republican President Trump will operate in a Congress which is entirely Republican. However, the checks and balances embedded in the American political system ensure that no president has carte blanche.09.11.2016 | 16:00 Uhr
Trump’s victory leads to a number of uncertainties and concerns on financial markets, which may initially weigh on them:
• Monetary policy : In the course of the campaign, Mr. Trump has questioned the independence of the central bank.
• Budgetary discipline: the combination of lower revenues (lower tax income) and higherexpenditure (infrastructure) may result in a significant rise of the budget deficit.
• Relationship of the US with its trade partners: the trade restrictions and protectionist stance would be primarily targeted towards emerging countries, China in particular. Currency devaluations may ensue.
• Geopolitical situation: the isolationism put forward by Mr. Trump in that regard may lead touncertainty.
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