The American election is fueling a roller coaster in trade: the dollar had fallen significantly the day before after the publication of better polls for Democratic candidate Kamala Harris, before experiencing a sudden turnaround in the first polls after the start of the vote.
Economists and investors expect that if successful, Donald Trump will put in place new customs barriers, reduce taxes and deregulate the economy – enough to cause a widening of the public deficit, then a rise in bond rates and consequently a rise in the dollar.
“Throughout October, it is obvious that the dollar, Asian currencies and American interest rates have evolved according to anticipations about the American elections” and the markets “will adjust on Wednesday as the new information” on the outcome of the vote, analysts at MUFG bank had predicted.
As Trump leads US election, bitcoin hits all-time high
Under a Trump presidency, “our scenario estimates that the dollar could strengthen by around 7 to 8% compared to the basic outlook in the event of Ms Harris’ victory”, they insist.
Conversely, if Kamala Harris won, the correction could be brutal, “with a weakening of the dollar and strengthening of Asian currencies (economies) oriented towards exports”, like Japan.
