The dollar surged and bitcoin hit a record high Wednesday as traders bet on a victory for Donald Trump as he picked up two of the key swing states needed to take the White House, ramping up bets on fresh tax cuts, tariffs and rising inflation.
While polls had shown the race on a knife edge, the Republican appeared to be faring better than his Democratic opponent Vice President Kamala Harris as results rolled in.
Both candidates have picked up expected wins in safe states, but indications that the business tycoon was edging it boosted the so-called Trump Trade.
While many key swing states were too close to project, Trump won Georgia and North Carolina, with others still up in the air.
News that the former president’s party had taken control of the Senate boosted the prospect of sweeping tax cuts, more tariffs and deregulation — seen as a boost for the greenback.
The dollar jumped 1.5 percent to 154.33 yen, its highest since July, while it was also up more than one percent against the euro and more than three percent against the Mexican peso.
Bitcoin piled almost $6,000 higher to a record $75,330.88, topping its previous peak of $73,797.98 in March.
Trump has pledged to make the United States the “bitcoin and cryptocurrency capital of the world” and to put tech billionaire Elon Musk in charge of a wide-ranging audit of governmental waste.
“The price of bitcoin has closely followed Trump’s position in the polls and on betting markets,” Russ Mould, an analyst at AJ Bell, said ahead of Tuesday’s US election.
Investors are “potentially taking the view that a Republican victory would lead to a surge in demand for the digital currency”, he added.
Analysts said a clean sweep of Congress and the White House for Trump and Republicans would likely boost the dollar and Treasury yields owing to his plans to cut taxes and impose tariffs on imports.
Republican control of the Senate and House “could bring sweeping spending or tax policy shifts. Still, congressional gridlock could be the ultimate volatility suppressor”, said SPI Asset Management’s Stephen Innes.
