The victory of Donald Trump in the presidential election of the United States (US) has triggered a decline in the market due to 'Trump Trades' as a signal that investors are starting to be more cautious.
The political push also triggers a different direction for the Federal Reserve (Fed) target when the mandates are able to re-trigger an increase in inflation.
Recently, Fed Chairman Jerome Powell in his speech said that there is no urgent need to lower interest rates because the economy is still strong and this causes the market's hope for a rate cut to take place.
In addition, consumer and producer price data rose slightly higher in October compared to September, indicating that inflationary pressure at the end of the year is still at risk of rebounding.
Jerome Powell also said the Fed's target of bringing inflation to 2% is getting harder.
Financial giant Blackrock expects a rate cut in December to be less certain and its decision will reflect the Fed's policy in 2025.
Although the market is still calm, many see the United States economy as being able to land safely (soft landing) to avoid a severe recession.
For investors, the significant high shift after the election seems to give difficulty in anticipating the next direction.
