NEW YORK- US Treasury yields edged lower on Monday as traders digested a still-strong US economy and the likely policies of a Donald Trump administration after Republicans won the presidency and control of Congress.
Yields rose heading into the Nov. 5 US elections on expectations of a Republican sweep. They have only modestly added to these gains since the Republican victories as traders evaluate which policies are now likely to be enacted.
“A red sweep might have already been increasingly priced in, but also I think there’s just still a lot of uncertainty about what the federal policy landscape looks like next year,” said Will Compernolle, macro strategist at FHN Financial. Lower tax rates and looser business regulations under a Trump administration could boost growth while other policies, including clamping down on illegal immigration and enacting new tariffs, may boost inflation but then also dampen US economic strength, analysts said.
