Here’s Why Trump’s Win Sent Dollar And Bond Yields To Multi-Month Highs | Forbes Topline - video Dailymotion

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Financial markets’ strong reaction to Donald Trump’s projected return to the oval office included a spike in the value of the dollar and a sharp selloff in fixed income, hinting at both investor optimism at strong economic growth and concerns about inflation.  Read the full story on Forbes: https://www.forbes.com/sites/dereksaul/2024/11/06/heres-why-trumps-win-sent-dollar-and-bond-yields-to-multi-month-highs/  Subscribe to FORBES: https://www.youtube.com/user/Forbes?sub_confirmation=1  Fuel your success with Forbes. Gain unlimited access to premium journalism, including breaking news, groundbreaking in-depth reported stories, daily digests and more. Plus, members get a front-row seat at members-only events with leading thinkers and doers, access to premium video that can help you get ahead, an ad-light experience, early access to select products including NFT drops and more:  https://account.forbes.com/membership/?utm_source=youtube&utm_medium=display&utm_campaign=growth_non-sub_paid_subscribe_ytdescript  Stay Connected Forbes newsletters: https://newsletters.editorial.forbes.com Forbes on Facebook: http://fb.com/forbes Forbes Video on Twitter: http://www.twitter.com/forbes Forbes Video on Instagram: http://instagram.com/forbes More From Forbes:  http://forbes.com  Forbes covers the intersection of entrepreneurship, wealth, technology, business and lifestyle with a focus on people and success.

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00:00Financial markets' strong reaction to Donald Trump's projected return to the Oval Office

00:05included a spike in the value of the dollar and a sharp selloff in fixed income, hinting

00:10at both investor optimism at strong economic growth and concerns about inflation.

00:16The U.S. dollar index, which tracks the American currency's exchange rate against a basket

00:21of six other developed market currencies, rose 1.8% to about $105.30 by around 8 a.m.

00:30Eastern Time, registering its highest level since early July.

00:35And bond yields spiked with the benchmark 10-year Treasury rising 16 basis points to

00:40a four-month high of almost 4.5%, the largest daily jump in 10-year yields since April.

00:48Higher bond yields point to a fixed income selloff as investors demand higher annual

00:53payouts to hold government debt.

00:56The dollar's rise is partially a reflection of the protectionist trade policy endorsed

01:00by Trump, and the Treasury is in part a result of investors moving money into riskier assets.

01:07But there's also a more pessimistic reason for the movements.

01:11If debts climb under Trump, coupled with concerns about the impact on goods prices due to tariffs,

01:16inflation could remain elevated for longer than previously expected, which in turn would

01:21likely cause the Federal Reserve to pump the brakes on its interest rate-cutting cycle

01:26kicked off in September.

01:28So lessened rate-cut expectations push up bond yields as traders price in interest rate

01:33cuts closer to today's 4.75% to 5% in the medium and long run, and higher expected rates

01:41simultaneously drive up the value of the dollar as the likelihood of cheap borrowing costs

01:46in low-rate environments decreases.

01:49For more on this story, read Derek Saul's article on Forbes, linked in the comments.

Here’s Why Trump’s Win Sent Dollar And Bond Yields To Multi-Month Highs | Forbes Topline

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