EBRD head says U.S. election's market impact not yet clear
By Krisztina Than BUDAPEST (Reuters) - The lasting market impact of Donald Trump's U.S. presidential election win will not be clear until his administration's policy ideas become known, the head of the European Bank for Reconstruction and Development (EBRD) said on Wednesday. Wall Street stocks rose sharply on Wednesday, bouncing from a dramatic overnight sell-off in a volatile initial reaction to Trump's surprise win. Treasury yields rose on concerns his policies would ultimately weaken the dollar and hike inflation. "We have seen an immediate impact, but I think we have to wait for the medium term to see the (broader) impact," Suma Chakrabarti told Reuters in an interview during a conference in Budapest. "We had the Brexit result (when Britain voted to leave the EU) and things did not quite pan out the way people thought they would so we have to wait and take a sober judgment". The U.S. policy picture would be clearer by the end of January, he said. The election result was another sign that many people, in many of EBRD's shareholding countries, were feeling disaffected and "feeling that the world economic system had let them down." TURKEY TRIALS Turning to Turkey, which is the EBRD's biggest market with over 1.9 billion euros (£1.67 billion) invested last year, Chakrabarti said the bank was keeping a close eye on the trials of people allegedly implicated in a failed coup attempt in July. Turkish authorities have arrested tens of thousands of people, including teachers, public officials and journalists, since then. Chakrabarti said that introducing a state of emergency was understandable, "but at the same time it is incredibly important that the trials that are coming... are really fair." For Egypt, the EBRD was "very supportive" of an IMF programme that could help investor perceptions of the country. He said the EBRD was closely watching developments in the Polish banking and energy sectors to see to see what kind of policies the government adopts. "If ... the renewable sector framework is changed, that could impact negatively on future investment by us and by other investors," he added. Poland could be EBRD's third biggest market this year with around 700 million euros invested. (Reporting by Krisztina Than; editing by John Stonestreet)
