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Do politicians matter?

| Posted by: Paul Donovan | Tags: Paul Donovan

  • The Trump Twitter Feed expressed some disquiet about an op-ed in the New York Times, reported to have been written by a senior political appointee in the White House. Media (and US President Trump) are likely to be excited. Financial markets are not.
  • Stories like this affect markets if they change the US president's ability to work with Congress. If the chance of US President Trump being removed from office were to rise, markets would price in President Pence. Neither situation applies today. However, if the finite resource of presidential time is focused on leaks, less time is spent on protectionism and consumer taxes. Markets might care about that.
  • Revised US productivity and unit labor cost data is due. This is not a market focus. Comments by new New York Fed President Williams may be worth attention. With a Fed led by a lawyer, Williams is one of a dwindling band of economists with a policy vote.
  • The interminably tedious process of cutting the EU off from the UK is at the stage where traders start exaggerating the slightest hint of a story to inject some interest into proceedings. Yesterday sterling danced around on suggestions that a deal was more likely.