USD strengthens on election latest
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Daily Currency Update
Republican candidate Donald Trump declared himself the victor in the US presidential election this morning, as his electoral votes reached 267, just 3 short of an official win. Trump has already secured key states such as North Carolina, Georgia, and Pennsylvania. Additionally, Republicans are poised to gain control of both the Senate and the House, providing Trump with a “powerful mandate” to implement his economic agenda. This Republican majority is expected to ease the path for Trump's inflationary policies, reflecting his protectionist views on immigration and trade. This has heightened expectations that the Federal Reserve will continue to cut interest rates by 25 basis points on Thursday, though market participants will be watching for signals on future rate cuts.The USD has since strengthened following Trump’s self-confirmed election win, pushing the currency pair down to 1.2850. EUR/USD similarly rose to 1.0935 but has traded as low as 1.0710 in the past few hours. GBP/EUR has moved higher, testing 1.2000 several times overnight, but has not comfortably broken above this level.
Key Movers
It appears only a matter of time before Trump secures the final 3 electoral votes needed to confirm his presidency. Markets are expected to remain volatile as they react to this development, further impacting an already fluctuating USD.This morning, the UK construction PMI will be released, and ECB President Lagarde will speak at the 10th Anniversary of the Single Supervisory Mechanism in Frankfurt. However, these events are unlikely to move the market significantly, as attention now shifts to Thursday's interest rate decisions from the Bank of England and the Federal Reserve. Both central banks are anticipated to cut rates by 25 basis points.
Expected Ranges
- GBP/USD: 1.2790 - 1.3050 ▼
- GBP/EUR: 1.1890 - 1.2040 ▲
- GBP/AUD: 1.9450 - 1.9710 ▼
- EUR/USD: 1.0640 - 1.0910 ▼