For early trends in US presidential race, we should keep an eye for swing states such as North Carolina, Georgia & Michigan. A Trump victory in Michigan is likely indicator for a Red sweep. A Harris victory in North Carolina & Georgia is likely indicator for her winning the presidential race. For Pennsylvania, the key congress seat for PA-07 holds the key for which way this key swing state votes in the US presidential elections. Post election, policy outlook wise, 10yr UST could test 4.5-4.65 in case of a Red sweep across President, Congress & Senate. DXY might test 107 levels. We assign it 40% probability. A Trump win with Dems in Congress might pull 10yr UST yields lower towards 4.15. DXY might see a minor correction towards 103 levels. We assign it a 30% probability. A Harris win with Republicans in Congress might pull 10yr UST yield all the way down to 4%. DXY might correct significantly towards 102 levels. We give this a 30% probability. Policy wise, deficits and debt will likely exceed the current CBO baseline under any scenario. A Trump presidency may see front-loaded revenue from tariffs, but worse long-term debt dynamics. Across-the-board tariffs would likely be inflationary and negative for growth. We would expect the Fed to pause their easing cycle if realized inflation moves higher. Trump’s extension of the corporate tax cuts might add 4 TN USD to the US fiscal deficit over the next 10 years. Trump’s large tariff proposals of 50% or more could add 2600 USD per year to US Households annual expenditure. Trump's anti immigration policies could increase wage inflation by means of lower supply of labour.
