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Talent Forex Market Update: November 9, 2020

We start the trading week with the news of the election finally being called for Biden and very little chance of Trump mounting a credible effort to overturn the results. At this point, it is probably more important to focus on the Senate results which won’t be clear until early January with the 2 Georgia runoffs. The implications of Senate control are crucial to the timing and size of any additional Covid stimulus. With the uncertainty of any new stimulus, the Fed’s role is being pushed to the fore. If they are forced to do more to fill the vacuum, the ensuing interest rate weakness will continue to weigh rather heavily on the US Dollar. 

This week will be critical in setting the tone for the market’s interpretation of a Biden presidency. Also, it is important to note that 2 more months of the Trump administration is likely to provide some interesting moments. Let’s not forget that China is still on his radar and he may choose to deliver some parting shots that shake up the FX Markets. 

Finally, in Turkey, Erdogan’s son in law has resigned as central bank chief which is being viewed initially a positive. Stay tuned here as any shakiness could spiral out of control rather quickly in this uncertain environment. 

Key Takeaway: The USD starts the week on relatively weak footing. That could continue as the USD drifts toward the low end of its range, particularly vs. EUR, GBP and JPY.

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