Is Trumponomics the Right Medicine for US Economy?

January 20, 2017 Share Print 0

Tax cuts, deregulation and more federal spending advocated by the incoming Trump administration are a classic remedy for economic stagnation and long unemployment lines.

But that medicine may be too strong for an economy that has grown for eight years, with wages now rising and the jobless rate near what many economists consider “full” employment.

A Reuters analysis of regional jobs data and historic trends suggests that stimulus could boost demand for workers in areas where labor is already tight. That in turn, could stoke inflation, force the Federal Reserve to raise rates faster than expected, and make recession a greater threat.

Reuters

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Craig Erlam

Senior Market Analyst, UK & EMEA at OANDA

Based in London, Craig Erlam joined OANDA in 2015 as a market analyst. With many years of experience as a financial market analyst and trader, he focuses on both fundamental and technical analysis while producing macroeconomic commentary. His views have been published in the Financial Times, Reuters, The Telegraph and the International Business Times, and he also appears as a regular guest commentator on the BBC, Bloomberg TV, FOX Business and SKY News. Craig holds a full membership to the Society of Technical Analysts and is recognised as a Certified Financial Technician by the International Federation of Technical Analysts.