the bank’s chief economist Anna Breman on how the outcome of the presidential election in the US can affect the economy in Sweden.
Around 03.00 in the night, Swedish time, began to Swedbank’s chief economist understand vartåt the presidential elections in the united states was going. A few hours later, it was clear that the country’s new president named Donald Trump.
” I think it is worrying and it creates uncertainty, but I really want to stress that the short-term most concern for the financial market. I see no slowdown in the global or american economy of this in the short term, ” says Anna Breman to the Business world and are continuing:
– In the short-term run of the Swedish economy and other factors. Consumption is strongly similarly, the labour market and we have investment in housing and the service sector. It is not exports that drives the american economy right now. However, in the longer term, there are risks for Swedish exports, if Trump makes it he has said he will do and increase the barriers to trade.
the News that Donald Trump won the elections had a direct effect on the stockholm stock exchange was turned down. An hour after börsöppningen had AFGX recovered slightly and was at 10.00 am down to approximately 0.9 per cent.
” Because it creates uncertainty in the market, so I think that it can give a subdued effect on the stock market in the future. At the same time, we have a weak dollar that benefits the Swedish export and no decision has been taken yet.
According to Anna Breman, there are also other factors that can counteract a decline. The Swedish government finances are strong, and Europe looks generally good, she says.
” I think that you should be calm but have a very close watch on what happens and follow the development and be prepared that it may be volatile.
Who can benefit from Trump victory?
– Companies that are exposed to the Swedish market. Construction and healthcare company looks structurally good in this environment, but if you want to go into individual companies are enough stock analysts better suited to answer that question.
Just now affected the economy much of the uncertainty linked to the policy, ” says Anna Breman. In the summer voted british for an EU-exit, and Donald Trump has just been elected as the new president of the united states. The focus moves now to the elections in the Netherlands, France and Germany next year. Before that, it is a referendum in Italy on 4 december where the voters shall approve or trap, prime minister Matteo Renzis proposal to reform the Italian parliament.
– these issues need to monitor and also as marknadsmänniska you need to be good at political science right now.
How is the Swedish krona of it?
– When it gets scared so not benefit the Swedish krona. There will not be any major drop because the crown is already on a weak level.
The big question in the market right now, according to Anna Breman, if the Federal Reserve will refrain the interest rate hike in december.
” I think the Fed wants to appear to be apolitical and not be influenced by this. But if it continues to be messy on the stock exchanges in the next few weeks, when will the interest rate rise don’t get rid of. But I’m not going to change our forecast of an increase in december now, even if the probability of a rate hike has decreased dramatically.
How does this affect the Swedish interest rates and the Riksbank?
– If the Fed does not raise, it becomes more difficult for the ECB to scale down its expansionary monetary policy. Thus, the pressure on the Riksbank to continue. From the Riksbank’s perspective, it is best if the Fed raises in december. In other cases, it means low rates for longer periods of time in Sweden.
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