Dollar slides as Trump and Harris make final sprint

Former president Donald Trump and Kamala Harris hit the final straight of the most consequential Presidential race in decades this week as voters head for the polls.

Many see a victory for Trump as the only way the former President can avoid Jail for his role in instigating the riots in Washington 4 years ago. Trump spent yesterday at a Rally in Pennsylvania telling his audience that a victory would be “Liberation day” for America. Current polls show the race neck and neck however Harris has taken the lead in many key states, with as many as 75 million already casted their votes. The key state of Iowa has Harris ahead in latest poll which has weakened the Dollar. Trumps aggressive stance on immigration, tariffs and tax cuts could lead to upward pressure on the Dollar than a Harris win.

The key Battleground states of Michigan, Pennsylvania and Wisconsin will be closely watched, however traders will also focus heavily on Georgia as its awarded 16 electoral college votes (one of the highest of the battleground states). Be prepared for a long week as many of these states could well take days to declare as we saw in 2020. Trump has also made it clear that there will be court challenges to many states where he has lost. British intelligence has warned of Russia interfering by stoking up Trump supporters for ‘militant action’ were he to lose.

The conservative party announced its new leader Kemi Badenoch, the first black leader of a UK party. The 44 year old will finalise her cabinet these week as she looks to hold Labour to account and mount a challenge for the next election in 5 years time. Chancellor Reeves appeared to admit that she “was wrong” to raise taxes on the Laura Kuennsberg show yesterday after receiving a backlash over her ￡40bn tax raid.

Election aside, we have two very important rate decisions this week from both the Federal Reserve and the Bank of England. Traders have priced in a strong probability of a 25 basis point cut from the Fed on Thursday, just two days after the election we expect this to be almost a certainty (98% priced in).

Thursday lunchtime also sees a decision from Governor Bailey, where we also expect the Old Lady to follow suit of its US counterparts. Base rate decisions from Denmark (50bp cut) Norway and Australia (both hold) are also out this week. With uncertainty clouding the US election the FTSE 100 has bounced alongside Sterling this morning with Oil, mining and banking stocks all higher.

Finally, King Felipe of Spain was pelted with mud from residents as he visited flood hit towns after devastation seen in Spain’s East last week.

Trump Vs Harris

Who do you think will take the White House tomorrow—Trump or Harris? Watch as we capture the pulse of London's financial district on the 2024 US election! ???????

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