Trump’s economic policies may launch U.S. dollar rally but rock emerging markets
The post Trump’s economic policies may launch U.S. dollar rally but rock emerging markets appeared on BitcoinEthereumNews.com.
The conclusion of the U.S. elections could be the beginning of a dollar upswing. Although markets are full of uncertainty at the moment, the current market price action appears to mirror similar moves that happened after 2016 when Donald Trump first occupied the White House seat. Market analysts expect loose fiscal policies in the U.S. to fuel economic growth. The expectations have catalyzed an upsurge in the stock market, sending U.S. stocks to new highs. Investors speculate that the incoming administration will boost profits for U.S.-based firms through deregulation and tax cuts. Fed chair Jerome Powell hints at maintaining rate cuts in November Higher deficits and revived inflation could push the Federal Reserve into maintaining higher interest rates than it would have under a different administration. The higher rates are despite the proposed rate cuts that began in September. On November 7, the central bank slashed benchmark rates by a quarter of a percentage point to the 4.5% to 4.75% range from its previous range of 4.75% to 5%. Jerome Powell, the chair of the Federal Reserve, highlighted that rates may stabilize during the rate-setting committee meeting in December instead of continuing the cuts as initially projected. The committee believes it has confidence that inflation is heading towards 2%, as indicated in a previous statement released in September. The rate cut has boosted dollar strength against other currencies in the last few weeks. Donald Trump’s campaigns hinted at the introduction of tariffs. If the tariffs are implemented, massive changes in the global economy may be on the cards. The current market price action seems to be following the same trail that happened after Trump’s first election victory in 2016. In 2018, Donald Trump’s administration imposed a 25% tariff on half of everything imported from China. The Chinese yuan responded by…
Filed under: News - @ November 12, 2024 1:26 pm