Trump makes the euro cheaper and propels stock markets and interest rates go up – NOS

Against all expectations, caused Donald Trump rising rates on the financial markets. The value of the Us dollar goes on, the stock exchanges are in the best of spirits the new week began, and bond yields rise.

The euro fell this morning to 1,0729 dollar: the lowest price in almost a year. A cheap euro is good for export to the United States and for companies that are a part of their revenue in dollars, or from the United States, such as Ahold, Delhaize, Philips, and Shell. A more expensive dollar is not so fine for those with the camper wants to drive around in the USA or a weekend in New York book.

The stock markets are after a weekend to ponder, and to chew on the election victory of Trump higher start, after a volatile Friday. The AEX-index recorded at 11.30 hours, a plus of 1 percent to 450 points.

Inflation

The Trump effect is good to read at the rate of the dollar. During the campaign increased the dollar as Clinton in the polls climbed up and took the course down as soon as the odds of Trump increased. The idea was that the economy under Clinton could do better and more predictable would develop under Trump. But now Trump is chosen, it appears that it is a boost for the dollar.

The more expensive dollar makes for Americans abroad and thus the import is cheaper, for the Netherlands American products more expensive. But in the U.S., the chances of inflation increase by the boost the economy with all sorts of investments. This comes with the arrival of Trump, a rate hike by the Fed even closer.

rate of Interest

On the bond market for sovereign debt, you see the same movement and the interest rate rises. The U.s. 10-year interest was on 4 november, before the elections, on 1,77%. In the meantime 2,23 percent.

The investeringsdrift of Trump and the plans to reduce taxes, mean that the US capital markets need to finance. More demand for debt the interest rates rise.

Trump teems also on the European bond markets. The leading German Bund, loan with a term of ten years, has been of 0,134 percent on 4 november to 0,359 percent now, almost three times as much. In obligatieland such jumps quite unusual.

Pensions

bond yields, the yield called it is the yield that investors demand to a country for a loan. The higher the interest rate, the greater the risk.

for a long time, the bond yields are extremely and abnormally low by the policies of central banks. The Fed and the ECB have interest rates set at zero and the geldpersen on full blast let it run.

The higher rate of interest on the schuldmarkten has two faces. It makes debt more expensive and pushes up the interest rates for loans and credits up. Last week for the first time in years, the first hypotheekrentes increased. But for pension funds, the higher stock prices and rising interest rates good for the problem of low coverage rates. The need for measures, such as the shortening of the pensions is decreasing.

The lower obligatiekoersen lead, however, that the investments are worth less. In december to decide the pension funds about measures.

Also banks benefit from higher interest rates, because the interest differential between ingeleend and borrowed money improves.