Look around the exit polls and markets: a Trump House?
As Trump’s chances to win are rising, the financial markets keep sliding down. The latest polls indicate that Republican Donald Trump scored a series of surprising wins in battleground states including Florida, Geargia and Ohio, opening a path to the White House. Each candidate has its own path to this great building. Look at the chart below.
USD/JPY went below under 101.20 (from an earlier high in the session above 105.40). Aussie fell below 0.7585 as Trump won key states while Clinton struggled to hold on to “devoted” states. The pound jumped above 1.2540. The euro skyrocketed to 1.2930.
That is rather predictable because investors favored Clinton over Trump and because most forecasts expected her to win. It’s worth remembering that even if markets sunk and reach a new low the next day or two; it doesn’t mean they’ll keep falling or that the US economy is under the threat. The initial market reaction cannot be extrapolated to the future. Just look at the surprise “Brexit” vote a few months ago: markets were initially rattled; they tumbled, but then, they rebounded.