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Biden flips the election. Forex market goes bipolar while dollar is "frightened" and the yuan is optimistic
The election situation in the United States has undergone a major reversal overnight, and the red-to-blue turn of the two key swing states has turned Biden ahead.
The dollar index fell and is now at 93.418. The euro/dollar was at 1.1736 US dollars, stable from the previous trading day; the pound/dollar fell 0.19% to 1.2967 US dollars; the pound/euro fell 0.3% to 0.9055 pounds. The dollar/yen fell to a low in more than two years at 104.27 yen, which also fell against most other Asian currencies.
And Arizona leads, while Trump leads Georgia.
Analysts said that even if Biden successfully becomes the next president, the Republican Party may retain control of the Senate and thus be able to obstruct Biden's fiscal policy, which will make the outlook for the currency market full of uncertainty.
In addition, the market expects that Biden’s election victory will soften trade policies and weaken the currencies of countries that have been threatened by the Trump administration’s tariffs in the past. "Reflected from the trend of the RMB and the peso, the market is trying to digest Biden's victory," said Masafumi Yamamoto, chief foreign exchange strategist at Mizuho Securities.
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