Investor Expectations After the US Election

The recent US election results, with Republicans taking control of the presidency, Senate, and likely the House, have alleviated a major source of market uncertainty. Initially, this sparked positive reactions in the markets, but the economic outlook has since become murkier. The possibility of significant policy shifts—covering areas like tariffs, taxes, and immigration—opens the door to a wide array of economic scenarios, ranging from stagflation to accelerated growth. This heightened uncertainty poses challenges for credit markets, as neither extreme outcome is favorable for lenders.