One of the new sources of political uncertainty is destined to linger over the next year, adding to the headwinds for the U.S. and global economy – namely, the Trump impeachment inquiry. We recently examined the U.S. political outlook in the context of next year’s elections, and provided insights into past such inquires and how the process may play out in the coming year.
Critical to whether an impeachment conviction occurs, even if the facts point in that direction, is how the Republican-controlled Senate will vote should the House send the case to the Senate. The Senate will be greatly influenced by both the evidence submitted and public sentiment. The latter, in turn, will be at least partly affected by how well the economy performs. A recession next year, especially if it is at least partially blamed on Trump due to trade policy and impeachment uncertainty, could prove lethal to the President. Stay tuned.