Trumponomics in 2016 gives way to Trumpidation in 2017
The principal worry for many in financial markets following Donald Trump’s entry into the White House was that election promises on trade barriers and immigration restrictions would ultimately hold back economic growth and outweigh pro-growth Republican party policies including deregulation and higher infrastructure spending.
In fact, we have had relief and disappointment in equal measure: President Trump has fortunately so far not been allowed to follow through on such policies, while the Republicans have failed to achieve much of their own pro-growth agenda.
Many investors still believe, however, that the party will pass and implement at least some of its policies, which may explain why US equity markets have maintained their post-elections gains.
That said, much of the initial enthusiasm has faded, resulting in inflation expectations falling back to pre-election levels.
