Stuart Clark

It's been just a matter of weeks since Donald Trump secured his victory over the Democrats in the US presidential election and markets continue to grapple with what this means for the global economy and financial markets. On balance, Trump's campaign pledges of corporate tax cuts and deregulation should be positive for corporate America and will likely provide a near term boost to the US economy. However, we continue to watch developments closely, mindful there are hurdles ahead for the Republicans. Whilst supportive of US growth rates, the underlying policy mix of the new Trump administration should prove inflationary. This could complicate the path for central banks, and we see heightened risks that the Fed will need to delay rate cuts. As we look forward, we envisage a shift higher in both bond and equity market volatility reflecting the abrupt changes and unconventional methods of policy communication from Trump. Whilst the new administration in the US introduces some uncertainties in the path ahead, we remain alert to developments and optimistic about the opportunities that volatility will inevitably present.

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