The U.S. stock market hit fresh highs under President Trump’s watch, but investors must be cautious amid rising inflation and elevated interest rates. While Trump’s pro-business agenda has been a key driver of market gains, strategists warn that economic risks like inflation and higher rates could overshadow its benefits. Experts predict a potential 10% stock pullback in the coming months as markets face a challenging backdrop. Meanwhile, mixed signals from Trump’s comments on inflation and policy have left investors uncertain. With inflation at 2.9% year-over-year and borrowing costs remaining elevated, the road ahead for U.S. equities could be bumpy. However, institutional and retail confidence remains high, though some warn of potential volatility as earnings reports roll out later this week.
Source: https://markets.businessinsider.com/news/stocks/stock-market-outlook-correction-trump-rally-inflation-tariffs-interest-rates-2025-1