Trump press conference failed to invigorate confidence in achieving stronger growth in the USA - AmpGFX

Greg Gibbs, Director at Amplifying Global FX Capital, notes that there was significant volatility in several markets in the lead up to and during the Trump news conference on Wednesday. 

Key Quotes

“This may reflect two aspects: 1. allegations of potentially illegal and immoral actions made against the Trump election campaign team. 2. The lack of discussion on growth related policies by Trump in the press conference; instead he implied priorities are repealing and replacing Obamacare and building a wall on the Mexican border. Both may be substantial distractions for Congress and delay progress on more growth-supportive policies such as corporate tax reform and infrastructure spending.”

“The market may also have been unsettled by the aggressive nature by which Trump dealt with the media and intelligence agencies over the revelations that he was presented with an intelligence briefing including a dossier outlining unverified allegations reported in full on BuzzFeedNews.”

“The Trump press conference was opened by incoming White House Press Secretary Sean Spicer and Vice President Pence that both strongly criticized the news agencies for reporting on the intelligence briefing containing the alleged and unverified material.”

“Overall this press conference event failed to meet expectations that Trump might invigorate confidence in achieving stronger growth in the USA, although he did reiterate a claim he made during the election campaign that he would be the “greatest job producer God ever created”.  On the whole, he appeared to focus on many of the more contentious policy agenda items that fire up his loyalist voters in an attempt to misdirect attention away from the news storm over salacious allegations.”

“Whether any of this latest Trump saga has any lasting impact on the market remains to be seen.  It seems unlikely that the allegations will go anywhere.  Apparently, knowledge of the dossier created by a private company has been around for months in Washington.  The contents have never been verified and have been described as unverifiable.  If Russia has damaging information on Trump it is unlikely that it will release it, now made more unlikely since Russia has denied having such information.”

“In the end, this may well be a distraction that has distorted market trends rather than the start of anything bigger.”