The results of the US Senate election run-off in Georgia has yet to be determined. What are the implications for the US dollar?
Here is their view, courtesy of eFXdata:
TD Research discusses the potential market reaction to ([Tuesday’s] US Senate election run-off race in Georgia.
“Democrat control: Should the Democrats succeed in flipping the Georgia Senate seats, markets will need to weigh the risk around a potentially more ambitious policy agenda (i.e. regulatory and tax changes) and additional fiscal stimulus. Taken in conjunction with the easing of notable tail risks, we think this would fuel the USD’s downside momentum under the umbrella of reflation cemented by a higher inflation risk premium,” TD notes.
“Republican control: Should the Senate remain in the hands of the GOP, we think the USD could find some limitation in terms of the weakness observed across the G10, particularly against EURUSD where recent price action looks to have stalled around 1.23, at least tactically,” TD adds.
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