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	Opinion

A Clinton victory reduces political uncertainty

According to Martin Arnold, Director – FX & Macro Strategist, ETF Securities, a Clinton victory reduces political uncertainty, and takes another excuse away from the Federal Reserve to not raise rates at December FOMC meeting. USD is likely to continue to strengthen, particularly against safe-haven currencies like the JPY & CHF, in the lead-up to the FOMC meeting.

A Clinton victory reduces political uncertainty, and takes another excuse away from the Federal Reserve to not raise rates at December FOMC meeting. USD is likely to continue to strengthen, particularly against safe-haven currencies like the JPY & CHF, in the lead-up to the FOMC meeting.

GBP will likely come under modest selling pressure against the USD, but downside is limited.

MXN will continue to see a strong risk on rally, as US economic policy will not be a headwind for the Mexican economy.

If we see a Trump victory,? ?a sharp fall in the USD will result as uncertainty over trade and foreign policy jumps.

Rising FX volatility is another negative for the GBP. GBP moves inversely to volatility and will likely sell-off against major currencies. JPY and CHF will be the big gainers under a Trump Presidency.

MXN will experience a sharp fall as anti-Mexican sentiment from Trump is likely to depress investor optimism about the future of NAFTA and the benefits that accrue to Mexico from free trade.

Martin Arnold , November 2016

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