UBS predicts uncertainty in financial markets under potential second Trump administration, leaning toward DOGE policies

From Investing: 2025-01-11 04:00:00

UBS predicts uncertainty in financial markets in 2025 due to unclear economic policies under a potential second Trump administration. Will policies lean toward populist MAGA or fiscally conservative DOGE? This could impact labor, capital, and market dynamics. UBS leans toward DOGE policies, but intra-party divisions and fiscal debates add to uncertainty.

MAGA policies may lead to tariffs, deregulation, and deficit expansion, benefiting labor but straining capital. On the other hand, DOGE-leaning measures focusing on deficit reduction and private sector growth could create a better investment environment. UBS believes Trump’s history suggests a tilt toward DOGE policies in 2025.

UBS expects solid U.S. GDP growth, gradual disinflation, and further Federal Reserve rate cuts in 2025. Despite near-term volatility and policy uncertainty, UBS believes Trump 2.0 policies are more likely to support financial markets in the long run. Markets may remain range-bound until policy clarity emerges.



Read more at Investing: Will the overall Trump 2.0 economic ideology be more MAGA or DOGE? UBS answers By Investing.com