Trump trades waver
The Trump Trade Isn't Going As Planned This Year
Stocks, Treasury yields, and the dollar are down for the year, bucking expectations that they'd all rally.
·
5k reads
·
The Lede
The so-called Trump trade the boosted markets at the end of last year has floundered so far in 2025. Investor bets for a second Trump presidency were rooted in assumptions that stocks would soar on lower taxes and regulation, and that rates and inflation would creep up as tariffs led to higher costs for consumers. Investors are instead dealing with whiplash amid the president's back-and-forth approach to issues like trade policy, which has led to a weaker-than-expected stock market.
Key Details
- Even after a surprisingly hot January inflation report pushed yields and the dollar higher, they are still down to flat on the year, showing a faltering Trump trade.
- While the S&P 500 is up about 3% year-to-date, it's lagging behind international peers. Additionally, individual stocks and other assets tied to the Trump trade are suffering.
- The US dollar index — which weights the dollar against a basket of major currencies — had declined by about 0.4% since the start of the year through Tuesday.
