How Donald Trump’s US election win could affect mortgages and interest rates in the UK

Donald Trump’s US Presidential election win could have significant implications for mortgages and interest rates in the UK. The recent victory for Donald Trump against Kamala Harris in the US election has sparked discussions about how it could impact financial markets closer to home. With Trump’s potential policies on higher import tariffs and reduced immigration, economists are predicting potential consequences such as lower US gross domestic product (GDP) and higher inflation. This could lead to a 0.5 percentage point increase in the US Federal Reserve’s funds rate, impacting UK gilt yields and potentially causing mortgage rates for UK households to rise.

According to experts at Peel Hunt, an investment bank, the US election outcome could also have implications for UK stock markets and companies. The potential impact on companies could have a ripple effect on jobs and wages in the UK. Peel Hunt analysts believe that the policies of both candidates could pose risks for global economic growth, including the UK. They emphasise that the US economy plays a crucial role globally and any radical policies implemented in the US could have widespread repercussions.

As global economic growth is interconnected, events in the US, such as the outcome of the Presidential election, can have far-reaching effects on financial markets worldwide. Peel Hunt analysts underscore the importance of considering not just the initial effects of the candidates’ platforms but also how other countries might react to any policy changes. The uncertainties surrounding the US election outcomes could create significant disturbances in international financial markets, impacting economies beyond the US.

In conclusion, the US election results could have broader implications than just political changes. The potential economic consequences of Donald Trump’s victory could impact mortgage rates, stock markets, and companies in the UK, affecting individuals’ finances and the overall economic landscape. It’s essential for policymakers and investors to monitor these developments closely and adapt to the evolving financial environment.