Financial markets react strongly to new information about government policy direction and resolve.
Market Sensitivity: This study argues that tweets from U.S. President Donald J. Trump regarding Mexico significantly affected financial markets, specifically increasing Mexican peso volatility.
The Tweet Effect: The analysis focuses on็นๆๆฎ's Mexico-related tweets during his presidency, demonstrating how these communications influenced investor behavior by signaling policy resolve.
Social Media Signal: Using data on Trump_tweets and the U.S.-Mexico exchange rate, researchers find that social media allows investors to quickly assess both a president's likely policy direction and their commitment level.
This research highlights an important function of digital communication in modern finance: providing real-time insights into presidential resolve.
| Does the @realDonaldTrump Really Matter to Financial Markets? was authored by Allyson L. Benton and Andrew Q. Philips. It was published by Wiley in AJPS in 2020. |
