US Dollar Dips to 10-Week Low as Markets Cheer Biden's Victory

US Dollar Dips to 10-Week Low as Markets Cheer Biden’s Victory

Posted Monday, November 9, 2020 by
Arslan Butt • 1 min read

At the beginning of a brand new trading week, the US dollar has fallen to the lowest levels seen in 10 weeks as the risk sentiment in global financial markets receives a boost from confirmation that Joe Biden has won the US presidential election. At the time of writing, the US dollar index DXY is trading around 92.18.

News of Biden’s victory served to weaken the safe haven appeal of the US dollar and sent traders towards riskier currencies and instruments instead. The Chinese Yuan especially saw immense gains, rising to the highest level seen in over two years. Other currencies that have made gains include AUD, NZD, EUR, GBP and even the JPY.

The Chinese yuan stands to gain with Democrat Biden coming to power in hopes that Trump’s tariff war against China could be called off. The US-China trade war had previously driven the yuan below the key level of 7 against the US dollar.

However, the mood in the markets remains slightly cautious amid expectations that Trump may not concede. Since counting began, he has threatened legal action against vote counting, alleging fraud in states where Biden got the majority.

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