Long Dollar Looks The Shakiest Of The Trump Trades

Authored by Simon White, Bloomberg macro strategist,

Nominal yield-differentials are currently moving in the dollar’s favor, but it’s ultimately real yields that matter. With inflation in the US higher than most of the G10 and poised to accelerate more due to the size of the US’s fiscal deficit, the medium- and longer-term outlook for the dollar is negative.

Yields up, stocks up, dollar up -- so far, so predictable for a Trump victory. But of those three, the rising dollar is the one that looks most likely it will come unstuck.