US Elections: USD and equities to react positively to a split result – ANZ
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The US midterm election will be held on Tuesday, November 8. As strategists at ANZ Bank note, the US Dollar and equity markets tend to finish the month higher after midterms.
“We regard a Republican-controlled Congress as the most likely scenario (55%). Not far behind, at 41%, is a split Congress, with a Republican-led House and a Democrat Senate.”
“The USD and equity markets tend to finish the month higher after midterms.”
“Markets appear to like the checks and balances associated with a division between Congress and the president. This would be pertinent this time, given concerns of more policy-induced inflation pressures that would come from a Democrat-controlled Congress. On this basis, we also think the bond market would also welcome this division.”
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