Former U.S. president Donald Trump was shot Sunday while delivering a campaign speech. Trump economic policies are protectionist driven, as the U.S. economy is already within stagflation 'lite', note PPI release for June showing that prices are accelerating. A trump victory in November would add to already embedded inflation. Short end yields and the USD rise on the uncertainty of Trump's reaction after the shooting.

Former President Donald Trump was shot on Sunday and survived, whilst delivering a campaign speech in Pennsylvania.  Trump has offered more uncertainty to the market than Joe Biden, due to his protectionism, pro American industry and import tariffs as economic policies, which are all inflationary driven.  Thus, a Presidential win by the former President in November 2024 would be a factor in the short end bond market selling off, and yields rising.  Also note U.S. Dollar buying would also be a factor as current safe haven flows, due to uncertainty of Trump's election rhetoric, and if he is measured in his response after the assassination attempt.

The U.S., which is probably already in stagflation lite, note the rising Producer Price Index for June 2024, rose to 2.6% vs an expected 2.3% which shows an acceleration in the selling prices of domestic producers and consumer sentiment plunged to 8 month lows on rising prices.

The bond and U.S. Dollar markets are still caught in the headlights that the Federal Reserve under Jerome Powell, who will be reinstated as Fed governor if Trump wins the U.S. election  this year, will cut rates in September 2024.  Which, on the whole, with energy/oil costs climbing and geopolitical and domestic uncertainty now higher than ever, is an astounding assumption.  

Above chart is the 10 Yr yield and USD, which collapsed after the Consumer sentiment figures were released, ignoring the rising PPI.  Can the yield ignore the political/social and geopolitical uncertainty, that is now reaching its crescendo?  Beyond a possible rate cut end of 2024.

4.30% and beyond cannot be ruled out.