The election of Donald Trump sends the dollar and bitcoin soaring

The shockwaves of the Trump earthquake continue to be felt. The dollar strengthened further on Tuesday, reaching its highest in a year against the euro with the prospect of customs duties promised by Donald Trump, whose election also continues to push bitcoin up, close to $90,000. Around 5:40 p.m. GMT (6:40 p.m. in Paris), the European currency sank 0.53% against the greenback, to $1.0598, after reaching its lowest since the beginning of November 2023, at $1.0595. The pound for its part fell by 1.10% against the American currency, to 1.2726 dollars, digging into its lowest levels since August, also penalized by data on British employment. Some currencies “should be more affected by the entry into force of Trump’s new tariffs”in this case the Chinese yuan and the euro, underlined Fawad Razaqzada, analyst at City Index.

The American president-elect wants to increase import taxes from 10 to 20% for products entering the country, even those coming from the European Union, and has promised to go up to 60% for those coming from China. The New York Times also indicated Monday that Donald Trump would prepare to entrust key positions in his new administration to people with a history of harshly criticizing China, including the influential Florida senator Marco Rubio considered for secretary. of state. In parallel, “the dollar strengthens amid expectations of an interest rate hike from the Federal Reserve (Fed), due to Trump’s inflationary fiscal policy”recalls Mr. Razaqzada. Weakened by the strength of the dollar, the pound is also suffering from still stubborn wage growth, and from a higher unemployment rate in the United Kingdom during the three months ended in September.

This data published on Tuesday could lead the market to strengthen its bets on a rate cut by the Bank of England (BoE) next month, estimated Kathleen Brooks, analyst at XTB, after two quarter cuts of percentage point, in August and November. Benefiting on the contrary from the election of the Republican, bitcoin rose to $89,968.10 on Tuesday before falling to $87,598.25. Under a Trump presidency, with a Senate dominated by the Republican Party – also on course to win the House of Representatives – the United States could adopt bitcoin as a strategic reserve asset. Such a decision “could act as a powerful lever” for the price of this digital currency, speculates Simon Peters, analyst at eToro. In the process, he added, “other countries and nations may also adopt their own bitcoin cash strategy more quickly for fear of missing the opportunity”which is likely to further boost prices.