Will the overall economic ideology of Trump 2.0 be more MAGA or DOGA? UBS responds to Investing.com
Investing.com — UBS sees a mixed outlook for financial markets in 2025 as investors grapple with uncertainty over the economic policies of the second Trump administration. Key questions center on whether the approach will lean more towards populist MAGA or fiscally conservative DOGE, with significant implications for markets and the wider economy.
MAGA policies, characterized by tariffs, deregulation and increasing deficits, could benefit labor but burden capital. On the other hand, DOGE-focused measures aimed at deficit reduction and private sector-led growth may offer a more constructive environment for investment.
UBS predicts a tilt toward DOGE, citing Trump’s history of supporting markets and reining in excessive reflationary policies.
However, intra-party divisions and debates over fiscal policy, including upcoming budget and debt ceiling negotiations, add to the uncertainty. Markets are likely to experience volatility and remain range bound until policy is clarified.
UBS expects 2025 to be marked by solid US GDP growth, a gradual decline in inflation and further Federal Reserve rate cuts, which should ultimately support stocks and bonds. While short-term uncertainty may keep markets on edge, UBS believes Trump 2.0 policies are more likely to benefit financial markets in the long term.
