Hello, this is Daniel de Visé greeting you with today’s edition of Daily Money, refreshed and recovered from the election saga.
The day after Donald Trump clinched the election, the financial markets reacted by causing bond yields to spike sharply. According to Andrea Riquier, this “Trump trade” suggests that home loan rates will continue to climb regardless of the Federal Reserve’s decisions on interest rates later this week. (More details on the Fed’s actions will follow.)
This situation implies that potential homebuyers or those looking to refinance at a lower rate should act swiftly in the coming weeks before rates escalate further, potentially settling high for an extended period.
What happens if the Fed slashes rates unnoticed?
Medora Lee indicates that the Federal Reserve is expected to reduce interest rates again this week, but the decrease might be so minimal that it barely impacts consumers.
As the Fed wraps up its policy meeting on Thursday, the consensus among economists is that the committee will cut the short-term benchmark fed funds rate by a quarter of a percentage point. This follows a more substantial half-point reduction in September, marking the start of this rate-cutting phase.
Amid a hectic election week, will the public even register this change?
The implications of Trump’s victory for the economy
With President-elect Trump advocating for higher tariffs, reduced taxes, and stricter immigration policies, Paul Davidson explains that these actions are expected to drive inflation. However, economic experts are split on whether these policies will hinder or stimulate the U.S. economy.
Over time, the combination of increased tariffs on imports and tighter immigration policies could negate the positive effects of tax reductions on consumer and business expenditures, potentially slowing economic growth, although a recession seems unlikely at this point. Here is the complete analysis.
Essential stories to catch up on
- The key figures likely to influence Trump’s potential second term
- Scam victims have forfeited $1T this year
- The impact of Trump’s electoral success on Elon Musk
- Stock markets hit new highs following the election
- The status of Bitcoin post-election
About The Daily Money
Daniel de Visé provides personal finance insights for USA Today.
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Passionate about analyzing economic markets, Alice M. Carter joined THE NORTHERN FORUM with a mission: to make financial concepts accessible to everyone. With over 10 years of experience in economic journalism, she specializes in global economic trends and US financial policies. She firmly believes that a better understanding of the economy is the key to a more informed future.
