US Elections
As time goes by Trump’s victory in the US election is becoming more and more certain and resounding.
As we go to press (9.30 a.m., 6 November 2024) the available sources attribute 267 electoral votes (three shy of the threshold needed) to Trump.
- Trump seems to have won a good majority of the battleground states
- Republicans will also gain control of the Senate (for the first time in four years)
- The control of the House of Representatives is still uncertain
- Overnight markets quickly (re)adjusted to a Trump and Republican victory
Fed Rate Cut Remains on Track
Weak October employment report keeps Fed officials on track for 25bp rate cut come Thursday’s meeting.
- Non-farm payrolls increased by just 12k units last month (against expectations of 100k) – data distorted by two hurricanes and strikes at Boeing
- Unemployment held steady at 4.1%
- Muddied report suggests labor market is still down-shifting from overheated levels – supporting decision by Fed to continue dialing back and reducing possibilities of a “no landing scenario”
- It will likely be too early for Fed Chair Powell to comment on the monetary policy implications of the US election
The German Slowdown
Germany’s economic downturn is deepening, with industrial production down 16% from its 2017 peak and no meaningful GDP growth since 2021.
- Industrial Distress: the auto, chemical, and engineering sectors are struggling, with major companies like Volkswagen and Thyssenkrupp warning of layoffs and plant closures
- High energy prices, exacerbated by reliance on imported hydrocarbons, have put German manufacturers at a significant disadvantage, threatening long-term competitiveness
- Deindustrialization Risks: as the EU’s largest economy falters, the ripple effects could be destabilizing, making Germany’s struggles a critical watchpoint for global markets and investors
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The analyses and forecasts contained in this publication are based on assumptions, estimates and hypothetical models which may prove to be incorrect and therefore lead to substantially different results.