Donald Trump, the former president and current Republican frontrunner, is set to undergo his annual medical examination this week, just days before his 80th birthday. For a man who has built a brand on vitality and unpredictability, this routine check-up carries more weight than the usual white-coat procedure. To the City of London, it is a reminder that the world’s largest economy may soon be helmed by an octogenarian with a fondness for tariff wars and Twitter sprees.
British intelligence, ever watchful of political instability on the other side of the Atlantic, has reportedly assessed the health implications of a potential second Trump term. Their conclusion is predictable: uncertainty. The man who once suggested injecting disinfectant to fight COVID is not exactly a beacon of fiscal discipline or predictable policy. Markets hate uncertainty, and a Trump return would inject volatility into gilt yields, currency markets, and global trade flows.
Let us examine the numbers. Trump turns 80 in June. The average life expectancy for an American male is 73.5 years. He is already beating the actuarial tables, but that does not mean his health is irrelevant. The annual exam will be scrutinised for signs of cognitive decline, cardiovascular risk, or anything that might affect his ability to serve a full term. If the results are less than stellar, expect a premium on political risk in US assets. The dollar might wobble, and gold, the eternal safe haven, could see a bid.
From a market perspective, the health of a presidential candidate is a risk factor that cannot be hedged with derivatives. It is binary: fit or unfit. A clean bill of health removes one variable from the complex equation of the 2024 election. A questionable report introduces a new layer of uncertainty, potentially boosting the odds of a contest between Biden and a younger, healthier Republican alternative. That would be a net positive for bond markets, which prefer stability over drama.
But let us not get carried away. The British intelligence assessment is likely more nuanced than a simple yes or no. They are watching for policy continuity. Trump’s first term was marked by tax cuts that ballooned the deficit and trade wars that disrupted supply chains. A second term could see further erosion of fiscal responsibility, higher inflation expectations, and a more aggressive stance toward China. The gilt market, already skittish about UK fiscal policy, would not welcome a transatlantic debt binge.
On inflation, Trump’s policies are a mixed bag. His tariffs act as a tax on imports, pushing up consumer prices. His immigration crackdown could tighten the labour market, driving up wages. But his deregulation push could lower costs in energy and finance. The net effect is unclear, which is precisely why markets dislike him. Central banks, including the Bank of England, would face a headache coordinating policy with a White House that views the Fed as a rival.
Capital flight is another concern. If Trump returns and investors fear a repeat of the January 6th chaos, or a more aggressive trade war, money could flee US equities and bonds for safer shores. British gilts might benefit from a flight to quality, but that is a double-edged sword: a stronger pound would hurt UK exporters. The Bank of England would have to balance the inflation impact of a stronger currency against the growth drag.
None of this is to say Trump is physically unfit. The medical exam could reveal a man in robust health for his age. But the optics matter. An 80-year-old candidate raises questions about succession planning. If Trump wins, who is his vice president? That person would be a heartbeat away from the presidency, and the markets will price in that contingency. A strong, market-friendly VP choice could offset some of the uncertainty. A populist firebrand would amplify it.
For now, the City watches the calendar. The exam results will be parsed like a corporate earnings release. Every blood pressure reading, every cholesterol number, every cognitive test score will be analysed for political signal. It is an absurd state of affairs, but that is the world we inhabit. Financial markets are driven by expectations, and the health of a 79-year-old reality TV star turned politician is now a macroeconomic variable.
In the end, Trump’s health is just one more factor in the great casino of global finance. But it is a factor that can shift the odds dramatically. British intelligence knows this. The bond traders know this. And on the day of his exam, they will all be holding their breath.
