UBS Paul Donovan Daily Audio 'Managing Expectations': Analysis of the Political Costs of the Gulf War and U.S. Gasoline Tax Policy Impacts

UBS Paul Donovan noted in the daily audio 'Managing Expectations' that the political costs of the Gulf War have emerged, with U.S. President Trump proposing to eliminate the federal gasoline tax. Gasoline prices are directly included in U.S. consumer price calculations; even if the bill passes, a less than 19% per-gallon reduction would barely offset the more than $1.25 per gallon increase since the war began. Sensitivity to political costs may drive optimism in the U.S. toward reaching an agreement with Iran.