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Influence Of Trump’s Victory On World Markets

November 10, 2016
by Latisha Liming
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The aftermath of US election has increased the volatility in the world markets. The USD gained significance and reached a record high. The high valued beta currencies such as the CAD and MXN were dominated by the greenback. Investors have started to look for safer assets to protect their investment. This has resulted in an increase in interest in Gold, JPY and CHF. Gold emerged as a big winner on the election night gaining 133.40/oz.

The clear winners after the election of President Trump were US dollar, Swiss Franc and Japanese Yen. In hopes of Federal Reserve normalizing interest rates, the dollar value is expected to rise as more jobs are created and inflation is lowered. The volatility in the market has created an interest in the Swiss Franc, which is a safe haven currency. Short-term traders showed a lot of interest in trading the Franc and investors too are benefiting from the increased exposure.

The losers are Mexican Peso, Canadian dollar and China trades. The neighboring countries of America, Mexico and Canada are sure to face a tough economic situation as Trump has mentioned in his rallies that NAFA trade deal is the worst deal ever. From his rallies, it is clear that Trump will d everything in his power to put China under pressure for currency manipulation and trade. However, China will always execute deals that only benefit the country.