Federated Investors published the brief, "A quick take on the midterms: Gridlock." They ask, "What do you think the election outcome means for equities, the money markets and fixed income?" Deborah Cunningham, chief investment officer for global money markets, comments, "From an economic perspective, divided governance suggests mixed results. While the U.S. economy should continue to outperform the rest of the world, growth probably has peaked, although there is no recession in sight. We would anticipate inflation to continue to trend modestly higher on tariffs and trade disputes, with disagreements on these issues more likely in a divided Congress. We also expect wage inflation to keep trending higher as the worker skills that are available aren't necessarily meeting the requirements of many of the new jobs that are available. From a money markets perspective, we expect to see modestly higher short-term interest rates, probably in the 3+% neighborhood, with good growth and opportunity in liquidity products in a slightly increasing market." Robert Ostrowski, chief investment officer for global fixed income, adds, "Last night was as expected: no macro surprise and no real new information. The margins on the House and Senate races give something for each side to spin as victory. Maybe the pollsters were the real winners. Prepare for gridlock, which is generally constructive for the fixed-income markets as it reduces the tail risk to either end of the pre-election forecast (a "Blue Wave'' capturing all of Congress or a "Red Fort'' with Republicans holding off the Dems' charge.) ... Looking further, it will be interesting to see if President Trump and the House Democrats can work together on infrastructure and trade initiatives."

Email This Article




Use a comma or a semicolon to separate

captcha image

Daily Link Archive

2024 2023 2022
March December December
February November November
January October October
September September
August August
July July
June June
May May
April April
March March
February February
January January
2021 2020 2019
December December December
November November November
October October October
September September September
August August August
July July July
June June June
May May May
April April April
March March March
February February February
January January January
2018 2017 2016
December December December
November November November
October October October
September September September
August August August
July July July
June June June
May May May
April April April
March March March
February February February
January January January
2015 2014 2013
December December December
November November November
October October October
September September September
August August August
July July July
June June June
May May May
April April April
March March March
February February February
January January January
2012 2011 2010
December December December
November November November
October October October
September September September
August August August
July July July
June June June
May May May
April April April
March March March
February February February
January January January
2009 2008 2007
December December December
November November November
October October October
September September September
August August August
July July July
June June June
May May May
April April April
March March March
February February February
January January January
2006
December
November
October
September