Economics
Hispanic men helped propel Donald Trump back to the White House
DONALD TRUMP has claimed victory in America’s election, and may even win the popular vote, something he failed to do in 2016. Political pundits are now trawling through results to figure out how he did it. Among counties that have counted almost all of their votes, some of Kamala Harris’s most disappointing results came from Texas, in particular on the border with Mexico. In Webb County her vote share was 13 percentage points lower than Joe Biden’s in 2020. It was ten points lower in Dimmit and Starr, and nine points lower in Zapata. In each of these counties, more than five in six residents are Hispanic—a group that has historically been at the core of the Democratic coalition.
Pre-election polling suggested that Donald Trump had made substantial inroads with Hispanic voters across the country. Partial results suggest this swing has materialised, helping to push the former president over the line in battleground states. And while Hispanic voters as a whole have swung away from Democrats—along with voters of all ethnicities—his gains were particularly concentrated among Hispanic men.
In 2016 Hillary Clinton won Hispanic voters by a margin of 38 percentage points, according to exit polls. By 2020 Joe Biden’s margin had shrunk to 33 points. This year early exit polling conducted by CNN suggests that Ms Harris’s margin of victory among Hispanic voters is just eight percentage points—a remarkable collapse if right. This is reflected in county-level analysis, which shows her winning a substantially lower share of the vote than Mr Biden in heavily Hispanic counties, especially those in Florida (see chart). There are a number of possible explanations for the shift.
One is a long-term trend of racial depolarisation. American politics has realigned along social and cultural lines, making religion and education crucial demographic variables. These characteristics divide Hispanic voters just as they do the rest of the country. Another explanation is that Hispanic voters are more likely than other groups to say the economy is their most important issue, favourable territory for Mr Trump.
These explanations can also account for the fact that Hispanic voters are not moving towards the Republican Party at one pace. CNN’s exit poll finds a dramatic widening of the gender gap among Hispanic voters. Hispanic men have swung from voting for Mr Biden by 23 percentage points in 2020 to voting for Mr Trump by ten points this year. Hispanic women, by contrast, voted for Ms Harris by 24 points. While men of all ethnicities were more likely to vote for Mr Trump, the widening gender gap among Hispanic voters may indicate divides over issues such as abortion.
There is also substantial variation within the Hispanic population based on heritage or country of origin. Mexican voters, especially those in south west Texas, swung dramatically towards Mr Trump in 2020, for example. This year early evidence suggests that counties with large Dominican and Cuban populations swung the furthest away from Democrats, while Puerto Rican and Mexican communities shifted by a smaller margin. This could be the result of the feisty and divisive election campaign—marked by episodes such as a comedian insulting Puerto Rico at one of Mr Trump’s rallies—or of structural differences such as geography, language and generation.
As votes continue to be counted in the west, we will see further data from states, such as Arizona, California, and Nevada, that have large Hispanic populations. In Arizona and Nevada—important battlegrounds in this year’s election—a shift among Hispanic voters could be the difference between Mr Trump or Ms Harris winning the state. But the result of the presidential election is not in doubt. This year has cemented Hispanic voters’ position as a crucial swing constituency. For Democrats looking to what comes next, rebuilding their Hispanic coalition will be a difficult task.■
Economics
Consumer sentiment tumbles in April as inflation fears spike, University of Michigan survey shows
Economics
Fed’s Kashkari says rising bond yields, falling dollar show investors are moving on from the U.S.
Minneapolis Federal Reserve President Neel Kashkari said Friday recent market trends show investors are moving away from the U.S. as the safest place to invest while President Donald Trump’s trade war escalates.
With Treasury yields rising and the U.S. dollar sagging against its global counterparts in recent days, the trends are running counter to what you might normally see, the central bank official said during a CNBC “Squawk Box” interview.
“Normally, when you see big tariff increases, I would have expected the dollar to go up. The fact that the dollar is going down at the same time, I think, lends some more credibility to the story of investor preferences shifting,” Kashkari said.
The 10-year Treasury yield has surged this week after Trump announced his intention to slap a 10% across-the-board tariff against U.S. trading partners and threatened to impose even harsher select levies before backing down Wednesday.
At the same time, the greenback has slumped more 3% against a basket of global currencies, with moves potentially signifying a turn away from safe-haven U.S. assets.
“Investors around the world have viewed America as the best place to invest, and if that’s true, we will have a trade deficit. So now one of the ways that expresses itself is in lower yields across asset classes in America,” Kashkari said. “If the trade deficit is going to go down, it could be that investors are saying, OK, America no longer is the most attractive place in the world to invest, and then you would expect to see bond yields go up.”
Kashkari noted, however, that he is seeing “stresses” but not significant dislocations in market functioning.
Kashkari does not vote this year on the rate-setting Federal Open Market Committee but will vote in 2026. He noted that his focus in the current environment is on keeping inflation expectations anchored, echoing other policymakers’ statements that rates are unlikely to move until there is clearer visibility on fiscal and trade policy.
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Wholesale prices unexpectedly fell in March, setting up a favorable inflation backdrop as President Donald Trump began intensifying tariffs against U.S. trading partners, the Bureau of Labor Statistics reported Friday.
The producer price index, considered a leading indicator for pipeline inflation pressures, declined a seasonally adjusted 0.4% for the month, after rising 0.1% in February. Economists surveyed by Dow Jones had been looking for an increase of 0.2%.
Excluding food and energy, so-called core PPI also declined, down 0.1% against the estimate for a 0.3% increase. The index less food, energy and trade services increased 0.1%.
More than 70% of the slide in final demand prices came from a 0.9% tumble in goods prices, a key measure as policymakers look for inflation drivers. Services prices also pulled back, falling 0.2%.
Nevertheless, the indicators showed inflation still holding above the Federal Reserve’s 2% target.
Headline PPI showed a 2.7% 12-month rate while the index excluding food, energy and trade services was at a 3.4% rate.
Moreover, March inflation measures will be considered somewhat stale considering the uncertainty behind Trump’s trade policy. The president slapped a broad 10% levy against all imports while also revealing a menu of individual duties against dozens of other trading partners. Trump on Wednesday backed off what he termed “reciprocal” tariffs, instituting a 90-day negotiation period in an effort to reduce the U.S. trade deficit.
The BLS on Thursday also reported that consumer prices pressures were easing, down 0.1% for a headline rate of 2.4% and a core reading of 2.8% that was the lowest in four years.
This is breaking news. Please check back for updates.
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