Resume af teksten:
USA afholder midtvejsvalg tirsdag, hvor alle 435 pladser i Repræsentanternes Hus og 35 senatspladser er på valg.
Målinger viser ifølge teksten Demokraterne med cirka otte procentpoints forspring nationalt.
Et demokratisk flertal i Kongressen kan begrænse præsident Trumps indenrigspolitiske handlemuligheder.
Handelspolitik og udenrigspolitik fremhæves som områder, hvor præsidenten fortsat kan handle uden Kongressen.
Udviklingen i Iran og amerikanske militære kapaciteter i regionen kan påvirke energipriserne.
Teksten vurderer, at inflationen i euroområdet kan nå 4 procent, mens naturgaspriserne stiger.
AI-investeringer i USA stiger med mere end 20 procent årligt, mens datacentre er blevet et politisk emne.
USA’s føderale underskud er omkring 6 procent af BNP, og der ses ifølge teksten begrænset opbakning til finanspolitisk konsolidering.
Fredagens amerikanske jobrapport ventes at vise 75.000 nye job og en arbejdsløshed på 4,2 procent.
Fra ING:
Whisper it, but are Tuesday’s US midterms a bit of a non-event? Perhaps, but that risks overlooking some potentially significant economic consequences.
America’s vote has created surprisingly little conversation in recent weeks. No doubt, that is because the range of plausible outcomes has narrowed. The Senate race still hangs on a knife edge, but the House looks increasingly likely to fall to the Democrats. Clean sweep or not, Washington is heading for divided government.
That sounds like a recipe for inaction. But gridlock could increase the importance of areas where the president still has room to act. Here are three areas where I think the midterms could have global consequences…
First, the Middle East.
My colleague James Knightley recently argued that a split or Democrat-run Congress could pull Donald Trump in two directions: emboldening him to double down on the Iran war, while inviting greater pushback from lawmakers.
Gridlock makes domestic legislation harder, increasing the temptation to focus on areas where executive power is greater, including foreign policy. At the same time, a Democrat clean sweep would give the party more confidence to challenge the White House on Iran, potentially including over war-related funding.
But the new Congress does not take office until January. The more immediate question is what happens after Tuesday. Is Washington making a final push to lower oil prices? JD Vance’s letter to Iran this week was the clearest sign of diplomacy in some time. Or is the US preparing for fresh strikes once the midterms are out of the way and the political cost of higher gasoline prices becomes less pressing? Reports of additional US military capabilities in the region point in that direction.
Markets are clearly more worried about the latter. But if escalation does not materialise, our commodities team thinks some of the sizeable risk premium embedded in energy prices could unwind.
That matters enormously for Europe. Eurozone inflation could plausibly hit 4% next week, and that’s biased to go even higher so long as natural gas prices keep rising. If nothing else, expect elevated inflation until next summer, as I argued last week . The Bank of England is poised to hike next week for precisely this reason.
Second, AI.
I don’t need to tell you how central this is to the US growth story. This week’s strong GDP data reminded us of that. AI-related investment is rising by more than 20% year-on-year, while CapEx away from the build-out is still struggling for momentum.
But it won’t have escaped your attention that AI is becoming a political issue too. Voters are increasingly vocal about the rapid build-out of infrastructure, particularly data centres. An eye-catching poll from The Economist showed Democrat support surging this year among people living within 2km of a data centre, a group it estimates at around 12 million Americans. That is a serious number of American voters.
The immediate federal consequences may be limited. Permitting battles are often state and local issues, while attempts by Congress to unwind federal tax incentives or pro-construction policies could run into a presidential veto. But the midterms look like a marker for just how politically contentious the AI build-out could become ahead of the next presidential election in 2028. Given how dependent US equity markets have become on the AI story, and how shaky certain corners of the AI trade are starting to look, this whole issue matters well beyond Washington.
Third, fiscal policy and tariffs.
America’s fiscal trajectory looks ugly on almost every metric. The federal deficit is around 6% of GDP, and there is little evidence of appetite in Congress for meaningful consolidation. Last year’s tax bill was an obvious opportunity to change direction. It was missed. The divided government makes another serious attempt over the next two years even less likely.
It’s a stark contrast with the UK and Italy, both of which released sensible budgets this week, and both look markedly better on public finances right now. Italy in particular is often tarred with the same brush as the US on fiscal policy, despite running a primary surplus.
Back to the US, though, because fiscal gridlock could push attention back towards trade policy. Remember tariffs? After the Supreme Court struck down Trump’s emergency tariffs, temporary 10% blanket rates ultimately gave way to a more permanent structure under Section 301. The issue has since slipped remarkably far down the agenda.
But like foreign policy, trade is another power the president can wield unilaterally without Congress. Could we see the administration go after its trading partners – Europe in particular – with higher tariffs once again?
In theory, this would matter a lot for inflation and the Fed. Chair Kevin Warsh has repeatedly noted that roughly half of the inflation basket is running above 3%, and our analysis suggests tariffs explain a decent chunk of that. Then again, the refunds from the tariffs struck down in court have started rolling in and have further to run. Over the summer, as the chart above shows, those rebates exceeded the gross revenue from tariffs.
So yes, Tuesday evening might indeed be a quiet night for financial markets. But what happens next could make for a much noisier 2027.
James Smith
United States (James Knightley)
Midterm elections (Tue): It will be a very busy week in the US, with the midterm elections on Tuesday and the October jobs report on Friday as the highlights. All 435 House of Representatives seats and 35 of the 100 Senate seats are up for election on 3 November. Worries about the cost of living and the impact of AI on job security are regularly cited as key factors driving sentiment, while support for the conflict with Iran has wavered as gasoline prices climbed. Opinion polls currently suggest the Democrats lead by around eight percentage points nationally, and President Trump’s own approval rating has hit new lows, leading to Republican Party concerns about a demotivated electoral base. If the Democrats gain control of Congress, this will hugely constrain what President Trump can do, leaving him to focus on trade and foreign policy. See our full preview for more details.
Jobs report (Fri): This is the first of two jobs reports ahead of the next Federal Reserve policy decision on 9 December. The low-fire, low-hire narrative around the labour market holds and we expect jobs growth to come in at around 75,000 with the unemployment rate remaining at 4.2%. Fed officials have made it clear that their focus, for now, is on getting inflation back down to the 2% target, so it would require a very soft outcome, potentially even a negative jobs print, to meaningfully move market pricing for that December meeting. Markets are currently putting an 80% probability of a rate hike, which looks fair.
UK (James Smith)
Bank of England (Thurs): We expect a 7-2 vote in favour of a rate hike next week, the first since the Iran War. There’s still scant evidence of second-round effects on inflation, but rising natural gas prices make it hard not to act. We’d expect the Bank to stay non-committal on its next steps given the hefty uncertainty, though we expect a follow-up hike in February. The hawkish risk next week is that the Bank explicitly suggests further tightening is likely.
Eurozone (Bert Colijn)
Inflation (Wed): It’s the week after the ECB presser where President Christine Lagarde emphasised a lot of important data points she’ll collect before a December decision. The October inflation rate was one of them, and it’s up on Wednesday. With energy prices still rising and a lagged effect of natural gas on consumer prices, we expect inflation to remain around the 4% mark in coming months. The most important piece of information is everything outside of energy, though, as the ECB is nervously looking at second-round effects emerging. So far, the effects have been negligible, and it will be key to see whether October starts to see some movement in core inflation and food prices.
Kilde: ING, https://think.ing.com/articles/us-midterm-elections-three-scenarios-for-markets/
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