fxs_header_sponsor_anchor

News

US: The Harris-Trump debate – Commerzbank

Since it is such a dominant topic this morning, there’s no point in completely ignoring the debate between the US presidential candidates. However, the effect on the currency market was minimal at best, Commerzbank’s Head of FX and Commodity Research Ulrich Leuchtmann notes.

The effect on the currency market is minimal at best

“As I write this, the US Dollar (USD) is trading no weaker than 0.2% against the G10 average than it was last night. And even this mini-reaction is more likely a consequence of the yen strength (see above) than USD-idiosyncratic. AUD and NZD lost similarly. Of course, it is not irrelevant who will be living in the White House from next year on.”

“However, it is becoming increasingly clear that it is not as easy as many had hoped: to take 2016 as a model. At the time, Trump's victory triggered USD strength. At the margin, this may also be the effect this time. However, in the event of a Trump victory, there would also be USD-negative risks: that he might this time (better prepared) significantly damage the Fed's independence, that he might damage the USD's dominance by wanting to impose it on other countries (instead of accepting that it is the result of uncoordinated decisions by countless traders and investors).”

“Even if we could already predict the outcome of the election today, it would be completely unclear what the appropriate USD reaction would be. And so, it is only logical that the market cannot agree on a clear reaction to today's debate.”

 

Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.


RELATED CONTENT

Loading ...



Copyright © 2024 FOREXSTREET S.L., All rights reserved.