As for the recent events in the U.S. presidential elections, Donald Trump is likely to have won and ushered in drastic changes in the dollar and cryptocurrency markets. The U.S. dollar appreciated by around 1.5% against the British pound, euro, and yen as investors believed there will be a change in the economic settings as well with the backdoor entry of Trump at the White House.
Asian markets also reacted positively. The Nikkei 225 in Japan rose 2.6%, and the ASX 200 in Australia increased 0.8%.
Bitcoin had been soaring to new heights, rising above $75,000 at least partly because of Trump’s promise to make the U.S. a “bitcoin and cryptocurrency capital,” which had set the hopes of investors on fire.
This is further helped by his pro-crypto stance, as analysts believe this stance will greatly impact the industry, especially if the Trump administration continues to follow favorable cryptocurrency policies. Tesla’s stock in Frankfurt also rose by a whopping 14% due to the combined effect of the election of Trump and Elon Musk’s long-time stance for the digital currency or which may also enhance confidence among cryptocurrency investors.
Markets.BusinessInsider.com: Another reason for the concern is that this political shift will also lead to a threat of inflationary pressure. Trump’s economic policy is likely to be coupled with tax cuts and increased tariffs, especially against imports from China.
The market is very much looking forward to the Federal Reserve’s decision on interest rates in the next few weeks because Trump’s policies may increase the inflation expectations and exert additional pressure on the monetary policy of the Fed. Furthermore, tensions over China are increasing, especially because of the uncertainty that the Trump foreign policy would bring, especially over Taiwan.
