Anyone hunting for a ‘Trump trade’ at this late stage has probably missed the US election bus. If you bought gold as a traditional safe-haven asset back in February at £1,600 an ounce, you’d be a smug 33 per cent up by now – though my man in the bullion market tells me the rise is by no means all to do with presidential hopes and fears. There has also been big buying from China possibly linked to moves, with Russia and other unfriendly actors, towards ‘de-dollarisation’ of world trade using a partially gold-backed alternative currency. Which means there could be more upside ahead, my man says, and gold ETFs are still worth a look.
Meanwhile, if you’re a crypto believer, as Donald Trump sometimes claims to be, and you bagged some bitcoin at its January low, you could be an even smugger 67 per cent up. But you could also have taken that profit in March and avoided a rollercoaster ride since. The simpler version of this story is that stock markets have largely factored in Trump but would be mildly shocked by a win for Kamala Harris and disconcerted by a knife-edge result that takes weeks to resolve. And though Trump himself says he wants a weaker dollar to boost domestic manufacturing, forex pundits (including Goldman Sachs) think his return to the White House is more likely to boost the greenback against the pound and other major currencies, at least in the early months.
Bond markets are harder to read, because either candidate could boost public borrowing to new heights, testing global appetites for US government paper.
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