Investors should expect volatility in global financial markets in the first 100 days of Donald Trump’s presidency, said Tom Elliott, International Investment Strategist at independent financial advisor deVere Group.

Mr Elliott warned investors that “Market volatility should be expected over the next 100 days, the period in which new administrations like to lay down their mark for the rest of their term of office.”

Trump entered presidency with the aim of making ‘America Great Again’. However as Obama left the White House with the US economy growing at 3.5 per cent, the fastest rate of growth of any developed economy bar Canada, and unemployment at a modest 4.7 per cent.

“It is unclear in what sense America is not great, at least in terms of the economy”, commented Mr Elliott.

“The type of fiscal stimulus policies that Trump has promised, such as lower taxes and infrastructure spending, can make up for shortfalls in public spending and so stimulate a depressed economy. Yet the US is not suffering from a depressed economy, and inflation may be the result.

“Furthermore, with the U.S government deficit likely to hit its current $20 trillion mark in March, thanks to a continuing large budget deficit (of 3.2 per cent of GDP), the Treasury market may well take fright at the prospect of both oversupply and inflation should Trump try to enact such a policy.

The Federal Reserve has already begun to take Trump’s intentions into account, indicating that it may tighten monetary policy in 2017 faster than originally thought.

“In recent days it has speculated that rate hikes may be accompanied by a shrinking of its balance sheet. This would shrink the money supply, forcing up interest rates.”