Financial markets do not believe Joe Biden will win as there are no rise in expected inflation in the US and in expectations for long-term interest rates, no fall in share prices and no depreciation of the USD, per Natixis..
Key quotes
“The proposed doubling of the federal minimum wage in the United States (to $15 per hour), which would bring it to a high level relative to the median wage, would undoubtedly be inflationary.”
“Long-term interest rates would be driven higher by the rise in expected inflation and a significant increase in public spending (healthcare, security, education, infrastructure, the energy transition).”
“A fall in the equity market would be triggered by a fall in profits under the effect of tax hikes (higher taxes on income, profits, wealth and capital gains) and wage increases.”
“If US financial markets became less attractive due to the hike in the tax burden and the fall in profits, capital inflows would probably fall and the dollar would depreciate.”
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