Dollar falls after Democrats take US Congress in midterm elections
SPY•The dollar index fell 0.32% to 101.51 after Democrats won control of both chambers of Congress, putting the dollar on pace for its biggest daily drop in three weeks. The euro rose 0.38% to $1.1236, while markets continued to price in an 82.6% chance of a Fed rate increase of at least 25 basis points in December.
1. Dollar weakens after election
The dollar fell on Wednesday after Democrats captured both the House and Senate in the US midterm elections. The result removed uncertainty about potentially contested results and left a divided government, with a Republican president and a Democratic-controlled Congress. The dollar index fell 0.32% to 101.51, on pace for its biggest daily decline since October 15.
2. Euro and rate expectations
The euro rose 0.38% to $1.1236, after reaching its highest level since October 6. Markets priced in an 82.6% chance of a Fed rate increase of at least 25 basis points in December, up from 77.4% in the prior session. A private payrolls report showed a gain of 86,000 jobs in October, above economists’ 69,000 estimate.
