Donald Trump has declared himself the winner since all results seem to be going his way. Moreover, it appears that the Republicans will also take home the Senate and the House of Representatives.
The Moderate Party will have free rein during the coming mandate period, says SEB's chief economist Jens Magnusson.
Stock Market Friend
In the morning Swedish time, a significant increase is seen in futures trading on Wall Street, which is rising by nearly two percent. Even in Stockholm, the stock exchange is opening with rising prices after a slightly hesitant start in the pre-trading.
Trump is a big stock market friend, more than any other president, he measures his successes by how the stock market performs, says Magnusson.
Therefore, he will likely do everything to fulfill it. Among other things, he has said that he wants to lower corporate tax and income tax.
Trump's policy is clearly aimed at benefiting American companies, while tariffs are negative for the rest of the world and Europe, says Maria Landeborn, senior strategist at Danske Bank.
Inflation May Return
The financing of the tax cuts is unclear, which is fueling concerns about the US government's finances, which were already shaky before.
That's why interest rates are going up, says Magnusson.
Trump's policy is clearly inflationary, according to Landeborn. Tariffs raise prices, the threat of deporting migrants can increase wage pressure. Add the tax cuts, and there is a risk of rising prices again.
In 2025, inflation will be a question again, she says.
Dollar Surge
The dollar is surging and making its biggest gain since March 2020, according to the news agency Bloomberg. There are several reasons, but primarily because the US central bank may become more cautious about lowering interest rates.
The Swedish krona continues to weaken against the dollar, which costs 10.86 kronor on Wednesday morning. Even US interest rates are rising. The 10-year interest rate has taken a significant leap upwards, just like the interest rate on five-year government bonds.
Cryptocurrencies are also reacting positively to a potential Trump victory. Bitcoin surged overnight to over $75,000, a new historic record.
