Published: Wed, September 11, 2019
Money | By Ethel Goodwin

It became known as the Twitter trump's impact on the market

It became known as the Twitter trump's impact on the market

Analysts At JPMorgan Chase&Co. created an index to assess the impact of the posts of President of the United States Donald trump on Twitter on the yield of usa government bonds.

Of about 4,000 original Trump tweets, not counting retweets, that were sent during market hours last year and this year, 146 moved the market, according to the model.

The name is a mashup of the words volatility and "covfefe", an apparent typo the president tweeted in 2017 that caused a stir.

The Volfefe index can explain some of the movement in market forecasts of where rates are headed, particularly the shorter duration two-year and five-year rates, the analysts said. The study also assumes that the President is asleep between 5:00am to 10:00am.

Since his election in 2016, Trump tweets an average of about 10 times a day, about 14,000 times since then from his personal account, with 10,000 occurring after his 2017 inauguration.

"Trade and monetary policy have become an increasing focus for the executive branch, and everything from casual sentiments to seemingly formal policy intentions have been disseminated, globally and instantaneously, via this carefully scrutinized social media platform", said a report from the bank.

Make market volatility great again?

Trump's tweets, which have in recent months veered toward market-sensitive topics such as trade and monetary policy, have increasingly moved USA rates markets, analyst Munier Salem said in a note on Friday.

Strategists at the lender produced the "Volfefe" index by measuring which Trump tweets activated huge actions in Treasury yields, a single of the world's most intently followed marketplaces and a single that influences rates for stocks and practically every single other investment decision.

"We find little evidence that the market achieves "fatigue" on Trump tweeting", Chatterji wrote.

The ramifications of @realDonaldTrump's market takes aren't so definitive to be of use in the design of systemic strategies, Citi cautions.

"By this metric, "market-moving tweets" have ballooned in frequency this August", the report said.

Earlier in the year, Citi created a "Trump Tweet Tracker" which tracked how the President's tweets about the US-China trade war affected the S&P 500 and Shanghai Composite.

This story has been published from a wire agency feed without modifications to the text.

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