It’s under a month to go until one of the most acrimonious, contentious and disruptive US elections takes place. While the polls can tell us what may happen, we all know how unpredictable this vote could be, and in turn, how potentially volatile the US dollar may be in reaction to whether Donald Trump or Joe Biden wins.
The latest analysis gives Trump only a 22% chance of winning, but the same poll by Nate Silver gave him a 28.6% chance of winning the Presidency in the first place, back in 2016, so for many they are taking the polls with a pinch of salt.
National polls also show Biden leading, but then again, they showed Hilary Clinton in the lead, which wasn’t necessarily wrong. She won nearly three million more votes than Trump, but she lost because of the electoral collage system. So key to this election is the battleground states, and the number of votes in the electoral college.
Trump’s 2020 campaigns focuses on deeper tax cuts, lighter regulation and a continuation of America First. He’s pitching to bring back the economy and boost jobs to a nation still very much reeling from the coronavirus economic aftershocks, while at the same time pledging to protect US trade interests and continuing his tough stance on immigration. Michigan, Pennsylvania and Wisconsin all only just backed Trump in 2016 and are traditionally industrial states, who could have an effect on the election as they’ll have been heavily impacted by the Covid-19 shutdowns, but also will want to see what the nominees will do to not only protect jobs, but protect international trade.
This is Biden’s third attempt to become President, and the moderate/ self-titled progressive has declared that he stands for two things, workers who “built this country”, and values that can bridge divisions. He wants to rejoin the global climate accord, raise the minimum wage and reform criminal justice, moving from his 1990s tough on crime stance. Biden is also pitching “Buy American”, with plans to call the federal government to invest in $300bn in US made materials, services, research and technology.
Trump’s Covid-19 diagnosis with less than a month to go until the election, and how it could potentially change the course of his campaign, is something many are watching closely. Will voters sympathise with him? Will more people advocate wearing masks, as Biden has done? And will Trump, forced into isolation, be able to get his message out there enough in these crucial weeks?
After Trump’s 2016 victory, the US dollar rallied by over 6% in a space months, and if he wins again, we could see the dollar rally against the pound and euro, to $1.18 and $1.08 respectively, according to The Secret Economist. Historically the US dollar has risen after every election except for George Bush’s second term, so it’s worth noting the US dollar may react similarly if Biden wins.
The risk to the US dollar if Biden wins is if he wins but doesn’t gain both Houses, and thus the Republican-dominated Senate blocks many of his future policies. This may only be moderately risky to the greenback, but it could set the tone for the dollar in the months and quarters to come.
In a video message from the White House after his three night hospital stay, Trump addressed the public, the 245 million Americans eligible to vote, and said of coronavirus, “Don’t be afraid of it. You’re going to beat it.” Whether he beats Biden, we’ll have to wait and see.