As investors await the outcome of the U.S. presidential election, the recent debate between Donald Trump and Kamala Harris has added some fuel to the fire. Details were sparse, but tensions were high as the candidates sparred over key issues such as immigration, foreign policy, and healthcare. However, the true highlight of the debate came from an unexpected source – pop superstar Taylor Swift, who publicly endorsed Harris shortly after the event.
Following the debate, Asian markets experienced a slight downturn, and U.S. stock futures also slipped. The uncertainty surrounding the election has caused the dollar to weaken. PredictIt’s 2024 presidential election market showed a decline in Trump’s likelihood of victory, while Harris’ odds improved slightly.
Investors are now on edge as they await the November election, trying to predict the potential economic policies of each candidate and decipher who may come out victorious. The focus has now shifted to the U.S. inflation reading, even though the Federal Reserve has emphasized that employment is currently a top priority over inflation.
With expectations of a rate cut by the Federal Reserve next week, there is substantial uncertainty surrounding the size of the cut. Markets are currently pricing in a 50 basis point cut with expectations of further easing throughout the year.
Looking ahead, European markets are expected to open lower as traders closely monitor Fed moves leading up to the European Central Bank meeting on Thursday. The yen has surged to an eight-month high following comments from Bank of Japan board member Junko Nakagawa, indicating that the central bank may raise rates if economic conditions align with their forecasts.
Key economic events for Wednesday include the UK GDP estimate for July, UK industrial and manufacturing output data for July, and the U.S. inflation report. Investors should stay informed and alert as market dynamics continue to fluctuate in the lead up to the election.
Make sure to stay tuned to Extreme Investor Network for further updates and insights into the ever-changing world of finance.