Trump Suffers Heavy Election Defeat and Dollar Weakens
US midterm elections are coming in, with Democrats winning both the Senate and the House. A slightly slurring Trump has already told the Democrats they have done a good job while expressing some shock at the scale of Republican losses. Indeed the losses have gone deep with Democrats winning the Texas Senate seat for the first time since 1988.
This is a terrible result for Trump who has acknowledged that the Iran war is partly to blame. He added that he had no immediate plans to strike Iran and has suggested he’ll stop military support for Israel by the end of the year. Still, a kneejerk response is certainly not out of the question.
The US dollar has weakened, GBPUSD is now 1.3480 helped as well in part by growing talk of a possible rate rise tomorrow. GBP is up in the crosses as well, now 1.9260, 2.3970 and 1.8815 against AUD, NZD and CAD. EURUSD 1.1245, while USDJPY dropped from highs around 158.75 to 157.40 before recovering to current levels around 158.15. Without the election result it would have been interesting to see if USDJPY could have broken above 159.00, something it’s not managed since early September.
NZ unemployment was bad enough to send NZD lower and lead some to change their RBNZ rate forecast to no change in December from a rise. GTBNZD traded above 2.4000 for the first time in over ten years while AUDNZD hit 1.2480 which certainly helps the 1.2425 call I looked at yesterday.
Man Utd came from two goals down to beat Roma in the Champions League last night, offering manager Carrick a lifeline in the process. Aston Villa lost to Barcelona while Harry Kane’s Bayern beat Atletico Madrid 2-0. This evening sees Liverpool, Man City and Arsenal all in action.
EU inflation and US ISM PMI the main events on the calendar today but I guess we’ll also see full scale of the impact of midterm results when US markets open later today.
Have a great day…
- 09.00 EU composite PMI
- 10.00 EU HICP
- 13.15 US ADP
- 13.20 ECBs Lane speaks
- 14.45 US S&P composite PMI
- 15.00 US ISM services PMI
- 23.50 BoJ minutes
- 00.30 AUS trade balance