「Trump Trade」 Loses Momentum as Market Worries about Feasibility of His Tariff Proposal

BlockBeats News, November 8th, some investors in certain asset classes are gradually reducing their enthusiasm for the "Trump Trade," as they question whether Trump will push forward his ambitious tariff proposals after taking office as U.S. President.

As of Thursday's close, the U.S. dollar has erased most of its post-election gains, and after two days of intense volatility, U.S. bond yields have also returned to a recent range.

These movements suggest that as investors weigh whether Trump's policies align with his campaign promises, the market may experience fluctuations. With the settling of market turbulence, attention is shifting to other major events.

A key question in investors' minds is how much of Trump's threatened tariff measures will become a reality. Some are also taking profits, including trades betting on a stronger dollar and lower government bonds, which performed well earlier this week on expectations that Trump's policies would stimulate inflation and keep rates elevated.

Alvin Tan, Royal Bank of Canada Capital Markets' Asia FX strategy head, said, "There is skepticism about whether Trump will actually implement the policies he has proposed, particularly the tariff policy. However, this sentiment may be temporary because the market underestimates Trump's influence on trade policy—the U.S. President has broad authority to implement import tariffs." (FXStreet)