Let us check the market. Investors looked ahead to a possible Democrat victory at the November 3 United States Presidential election. Moreover, the United States President Donald Trump said that he is ready to sign off on some stimulus measures. Thus, on Wednesday, the United States dollar dipped.
Elections polls show a widening lead for Democratic presidential candidate Joe Biden. Meanwhile, some betting markets reflect the prospect of Democrats taking control of the United States Senate next month.
Mazen Issa is a senior FX strategist at TD Securities in New York. He said that FX markets are beginning to, at the margin, price in not only a Biden presidency. Nevertheless, they also price in a blue sweep.
Investors were building short bets on the United States dollar index.
Bets are that because of the growing likelihood of a Democrat victory. Issa said that the market looks at it as being reflationary.
A sweep of Democrats would make more massive fiscal stimulus more probable. Thus, it would weaken the United States’ currency. In a month, Biden opened his most comprehensive lead in the United States presidential vote. It, according to Ipsos/Reuters poll that released on Sunday.
Late on Tuesday, Trump said that Congress must quickly extend $25 billion in new payroll assistance to United States passenger airlines. It furloughs thousands of workers. It is because travel remains down sharply during the coronavirus pandemic. Thus, the United States dollar dipped.
Trump abruptly ended talks with Democrats on an economic aid package. He accused Nancy Pelosi, House of Representatives Speaker, of not negotiating in good faith. Thus, it sent stock markets tumbling on Tuesday afternoon.
Also, it boosted demand for the United States dollar. The dollar index tracks the unite against a basket of major currencies. So, on Wednesday, it fell 0.19% to 93.64. Before the comments of Trump, it reached a two-week low of 93.33 on Tuesday.
That is the current news of the market.