What Bessent’s Pro-Growth Agenda Means for Treasury Yields, Gold, Stocks, and the Dollar

Scott Bessent: Will His Treasury Leadership Steady the Markets?

President-elect Donald Trump’s choice of Scott Bessent as Treasury secretary has sparked optimism across financial markets. With his Wall Street pedigree and emphasis on fiscal stability, Bessent is seen as a steady hand capable of promoting growth while safeguarding the dollar’s global standing. Traders are analyzing his potential impact on Treasury yields, the dollar, gold, and equities.

How Will Bessent Shape Treasury Yields?

Treasury markets responded positively to Bessent’s nomination, with 10-year yields dipping to 4.3%. This reflects expectations that his policies will temper inflation fears while supporting steady economic growth. His fiscal focus—combining deficit reduction, deregulation, and disinflationary measures—should sustain demand for bonds, helping keep yields stable. However, if growth expectations accelerate, yields could rise over the medium term as markets adjust to higher borrowing and reduced bond-buying activity.

Will the Dollar Strengthen Under Bessent?

Bessent has underscored the importance of maintaining the dollar as the world’s reserve currency, signaling a strong-dollar policy. Bloomberg’s Robert Burgess noted that he must be “crystal clear” in advocating for a stable and robust greenback to reassure global investors. Bessent’s fiscal conservatism and growth-oriented plans are expected to support the dollar, countering fears of devaluation tied to Trump’s campaign rhetoric about trade competitiveness. Traders are likely to see short-term support for the dollar as Bessent promotes policies aimed at long-term confidence in the currency.

What About Gold?

Gold’s outlook under Bessent appears mixed. His pro-dollar stance could weigh on gold prices, as a stronger dollar typically reduces the metal’s appeal. Additionally, his disinflationary approach—highlighting controlled tariffs and gradual fiscal adjustments—may limit gold’s attractiveness as an inflation hedge. However, geopolitical uncertainties and residual inflation fears could keep gold range-bound in the short term.

What’s the Forecast for Equities?

Equities have rallied on Bessent’s nomination, with investors confident in his ability to balance fiscal discipline with pro-growth policies. Tom Lee of Fundstrat Global Advisors highlighted his market credibility, calling Bessent’s appointment a reinforcement of the “Trump put”—the administration’s tacit support for a strong stock market. Sectors tied to deregulation and domestic energy production stand to benefit the most under his leadership.

Market Forecast: A Stronger Dollar, Stable Yields, Equity Gains, and Muted Gold Movement

Bessent’s policies are likely to strengthen the dollar in the short term, aligning with his focus on global investor confidence and fiscal stability. Treasury yields should remain stable as his growth-oriented strategies attract bond demand while limiting inflation fears. Equities may extend gains as markets continue to price in deregulation and economic growth. Meanwhile, gold is expected to face headwinds from a stronger dollar and muted inflation expectations, though lingering uncertainties could provide short-term support.

Traders should stay vigilant for shifts in Trump’s broader trade and fiscal agenda, which could introduce unexpected volatility across these asset classes.