US dollar drops as some polls favor Kamala Harris
by Bloomberg News, https://www.facebook.com/, https://www.facebook.com/BusinessMirror/ · BusinessMirror- Bloomberg News
- November 4, 2024
- 2 minute read
THE dollar fell as investors walked back bets on Donald Trump winning the US presidential election after weekend polls indicated Kamala Harris was gaining ground. Oil advanced after OPEC+ delayed an output hike.
An index of the greenback dropped the most in more than a month, while the Mexican peso—which tumbled in the aftermath of Trump’s 2016 victory—was the top performer among 16 major currencies tracked by Bloomberg. US Treasuries and European stocks rose.
Harris received some encouraging signals from an ABC News and Ipsos poll giving her a 49 percent-46 percent edge nationally against Trump in the race for the White House, while the New York Times/Siena survey released Sunday showed the Democratic nominee ahead in five of seven swing states.
A survey by the Des Moines Register that pointed to a lead for Harris in Iowa—a state that Trump has won in both of his previous contests—was a likely outlier, but served to underscore the ever-shifting dynamics of the race. Still, Harris’ advantage across all of the surveys was within the margin of error, and a NBC News poll released Sunday showed the race deadlocked 49 percent-49 percent.
The dollar gauge and 10-year Treasury yields both had reached their highest since July in recent weeks, after investors ramped up wagers on a second term for Trump. The argument goes that his support for looser fiscal policy and steep tariffs will deepen the federal deficit and fuel inflation, pushing up interest rates to the detriment of Treasuries but the benefit of the dollar.
“It’s impossible to call at this point,” Bill Maldonado, chief executive officer at Eastspring Investments, told Bloomberg TV. “We’ve heard Trump talking about tariffs and other measures, but do we really know what’s going to get implemented in what manner? It’s almost impossible to position for it.”
US futures edged higher after Wall Street’s gains Friday following robust earnings from the likes of Amazon.com. Nvidia Corp. rose 2.5 percent in early trading after an announcement that the chipmaker will replace Intel Corp. in the 128-year-old Dow Jones Industrial Average. Intel dropped 2.8 percent, while Apple Inc. fell 0.6 percent after Warren Buffett’s Berkshire Hathaway Inc. continued its sale of shares in the iPhone maker.
In addition to the US election, trading across financial markets this week also will be shaped by central bank decisions for the US, UK and Australia, among others.
The Federal Reserve is expected to cut rates by 25 basis points Thursday, after the latest jobs data showed US hiring advanced at the slowest pace since 2020 while the unemployment rate remained low. Even so, the numbers were distorted by severe hurricanes and a major strike.
Economists also expect the Bank of England to lower its benchmark rate by a quarter point to 4.75 percent.
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