His plans to cut taxes and boost government spending will likely drive growth and inflation, and raise the projected path of US national debt, which should be matched with a tighter monetary policy.
The prospect of more rapid US interest-rate increases and the rise in bond yields have driven the dollar up against most currencies and kindled a massive sell-off in emerging-market assets.
The “Trump Tantrum” has caused relentless outflows from the Stock Exchange of Thailand since the beginning of last month. To gauge potential future outflows, we compared the magnitude of this sell-off with two recent episodes, namely the “Taper Tantrum” in 2013 and the US |Federal Reserve’s rate increase a year ago.
The Taper Tantrum, which engulfed markets as investors feared the potential winding down (tapering) of quantitative easing in the US, lasted for four months and saw the 10-year US Treasury yield rise by 140 basis points.
The Trump Tantrum looks halfway done, with a 70bps increase in yield since the beginning of last month.
In terms of outflows, the 2013 Taper Tantrum sent Bt114 billion out of the SET, while the current episode has seen Bt49 billion exiting. That leaves potential outflows of about Bt65 billion.
Given the average daily outflows of Bt2 billion during the past two weeks, the outflows will run for 30 more trading days, or about a month and a half.
Under the more favourable scenario, the fourth quarter of 2015, when the Fed increased the federal funds rate by 25bps, saw total outflows of Bt65 billion.
This scenario leaves potential outflows of Bt16 billion.
We regard the fourth quarter of 2015 as a more reasonable comparison because of the low foreign holdings and similar nature of the shock.
In this case, we expect the outflow pressure to ease within a week or two.

Komsorn Prakobphol is head of strategy at the Tisco Economic Strategy Unit. He can be reached at http://www.tiscowealth.com or komsorn@tisco.co.th.