From Credit Agricole
The USD continues to ride the momentum in bonds yields, but there has been an important shift in the underlying driver of the yield curve.
President-elect Trump has proposed an ambitious fiscal stimulus agenda, including USD1trn in infrastructure spending, cuts in personal and corporate taxes, and incentives to bring back corporate earnings retained abroad. While this agenda is likely to be significantly restrained by the fiscal hawks in Congress, even a moderate fiscal stimulus with an economy near full employment could generate inflationary pressures.