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The Politics of Yields: Do Trump-Leaning Polls Influence U.S. Treasury Markets?

Lidö Mannervik, Hannes LU and Kita Elezi, Gent LU (2025) NEKH03 20242
Department of Economics
Abstract
This paper investigates the impact of Trump’s opinion polls on U.S. Treasury yields during
the 2016, 2020, and 2024 presidential elections. Focusing on both 2-year and 10-year yields,
the study examines short- and long-term perspectives and compares the effects across the
2016 and 2024 elections. Using a GARCH-in-Mean model and the “Trump-Head-to-Head
Momentum” (THHM) variable, we test three hypotheses: (1) the influence of Trump’s poll
momentum positively impacts the market yields on 2-year U.S. Treasury bonds during
election periods; (2) its effect on 10-year yields; and (3) a comparison of poll impacts
between the 2016 and 2024 elections. The results show no statistically significant impact of
poll momentum on yields. However,... (More)
This paper investigates the impact of Trump’s opinion polls on U.S. Treasury yields during
the 2016, 2020, and 2024 presidential elections. Focusing on both 2-year and 10-year yields,
the study examines short- and long-term perspectives and compares the effects across the
2016 and 2024 elections. Using a GARCH-in-Mean model and the “Trump-Head-to-Head
Momentum” (THHM) variable, we test three hypotheses: (1) the influence of Trump’s poll
momentum positively impacts the market yields on 2-year U.S. Treasury bonds during
election periods; (2) its effect on 10-year yields; and (3) a comparison of poll impacts
between the 2016 and 2024 elections. The results show no statistically significant impact of
poll momentum on yields. However, consistent with prior research, yield changes are
predominantly driven by lagged dynamics, with only marginal effects from fundamental
macroeconomic changes. These findings highlight the resilience of bond markets to “political
noise” and suggest that long-term yields remain anchored to structural factors. Furthermore,
this study contributes to existing literature by incorporating the THHM variable and offering
a comparative analysis across election cycles, encouraging future research to further expand
to other financial instruments and integrate political variables. (Less)
Please use this url to cite or link to this publication:
author
Lidö Mannervik, Hannes LU and Kita Elezi, Gent LU
supervisor
organization
alternative title
An empirical study on the relationship between presidential election opinion polls and changes in market yields on various U.S. Treasury bonds
course
NEKH03 20242
year
type
M2 - Bachelor Degree
subject
keywords
Keywords: Opinion polls, Donald Trump, U.S. Treasury yields, Efficient Capital Markets, GARCH-M, Presidential election uncertainty, Trump Head-to-Head Momentum
language
English
id
9184277
date added to LUP
2025-06-03 11:01:04
date last changed
2025-06-03 11:01:04
@misc{9184277,
  abstract     = {{This paper investigates the impact of Trump’s opinion polls on U.S. Treasury yields during
the 2016, 2020, and 2024 presidential elections. Focusing on both 2-year and 10-year yields,
the study examines short- and long-term perspectives and compares the effects across the
2016 and 2024 elections. Using a GARCH-in-Mean model and the “Trump-Head-to-Head
Momentum” (THHM) variable, we test three hypotheses: (1) the influence of Trump’s poll
momentum positively impacts the market yields on 2-year U.S. Treasury bonds during
election periods; (2) its effect on 10-year yields; and (3) a comparison of poll impacts
between the 2016 and 2024 elections. The results show no statistically significant impact of
poll momentum on yields. However, consistent with prior research, yield changes are
predominantly driven by lagged dynamics, with only marginal effects from fundamental
macroeconomic changes. These findings highlight the resilience of bond markets to “political
noise” and suggest that long-term yields remain anchored to structural factors. Furthermore,
this study contributes to existing literature by incorporating the THHM variable and offering
a comparative analysis across election cycles, encouraging future research to further expand
to other financial instruments and integrate political variables.}},
  author       = {{Lidö Mannervik, Hannes and Kita Elezi, Gent}},
  language     = {{eng}},
  note         = {{Student Paper}},
  title        = {{The Politics of Yields: Do Trump-Leaning Polls Influence U.S. Treasury Markets?}},
  year         = {{2025}},
}