In our scenario, there's still a few
bucks a coin between Kamala Harris and Donald Trump.
If Donald Trump were to be re-elected to the US, he's very inflationary.
And so I think that would cause the Fed to stop.
And that is the loosening cycle that is so, so far as, for example, initially we
thought, okay, the next influences three days after the election, that would be
anyhow a pause because we know it's going to be a contested election no
matter who wins, right? So, so we were bit in the camp that
maybe they should frontload. But and I think that's what the market
is getting to grasp with. And that's why that's super interesting.
Now, it looks maybe because of the polls also that there's going to be a very
gradual loosening, which is really what the US need to do.
This is the forward guidance 1 to 1. This is getting away from that
dependency, which was really a mess when it comes to how markets reacted to this.
Look at the bond volatility. And to me, I think that's why it's
switching the odds of going back to something much more orderly than trying
to get something through. Because indeed, where Trump should be
elected, there is a risk of inflation picking up again very strongly in 2025
in the US. Right.
So now what is out there is at least 75 basis points till the end of the year.
And then, you know, 25 is the big question mark for us.
It's these five rate cuts that Marcus showed, but it's really a question mark
because Trump could actually bring back tariffs, inflation, labour inflation and
certainly also the devaluation of the dollar is a big issue when you think
about how much imported possession could bring to the U.S..
So that's why Marcus Markets don't know much about because nobody knows who's
going to win this election.