Once in Donald Trump became involved in a scandal, and one, the market immediately reacted to a significant reduction. Now more and more there is talk about a probable impeachment of US President, Bridgewater Associates said that this is an extremely negative impact on the financial markets.
The world's largest hedge fund believes that market participants have to act in the conditions of extreme political uncertainty.
Analysts Greg Jensen and Dzheyson Rotenberg of Bridgewater said that even though they are not a political scientist, and can not make predictions as to whether or not the impeachment Trump announced. But thanks to the market-based instruments of political forecasting, they can say that the probability that Trump will leave his residence before the end of the presidential term is quite high, namely around 50%.
Analysts also noted that Trump's team is not ready to such shocks, as if it were ready, the market is not so much reduction would react.
In addition, Bridgewater experts made possible developments in the market, if the US president's impeachment will take place as follows:
- US stocks will show a decline of 11%
- European shares were down a little more - 12%
- Japanese stocks will collapse more - by 16%
- yields on US 10-year bonds will be cheaper by almost 1%
- the cost of safe-haven assets increase, so the price of gold will rise by 14%
- yen to dollar rate will change to 16%.
It is noted that the changes in the market will depend on a lot of what's on how noisy the process will be.
Earlier, Bridgewater forecasted in the case of Trump election victory total sale in the markets, but in fact, it did not happen, but on the contrary, the market reaction was reversed.
Based on materials WELTRADE
