The US dollar might be in for more trouble as the political tensions in the US escalate a notch. With the presidential electoral campaigns in full swing, the political mayhem is surprising the world with new events unveiled each day. On Sunday, President Biden announced his official exit from the election campaign, endorsing Kamala Harris as a potential new candidate. Amid such stark developments, the US dollar is responding negatively to the changes, compelling it to trade below the lines.
Two Reasons Why the US Dollar May Document Additional Downfall
The US dollar index is currently trading at 103.27, down 0.13% in the last 24 hours. The subtle downfall may be attributed to the changes documented in the US political scenario. Here are two popular reasons why the USD downstretch may become more serious soon.
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Biden’s Exit and Introduction of Vice President Kamala Harris as a Potential Candidate
Per BNN Bloomberg, the dollar slipped and the Treasury rose post-Biden’s exit from the US presidential elections. The aforementioned development has yet to make a significant impact on the USD. However, with Kamala Harris being endorsed as the presidential candidate running against Donald Trump, the USD stats may derail up a notch.
As investors are aiming for Trump to become the next president, with Harris in the picture, the prospects of her winning the elections can significantly impact investor sentiment towards the US dollar and the American economy. The uncertainty spurred by the events mentioned above can turn the market volatile, leading the USD to note fluctuations and a downfall in its valuation.
Donald Trump Winning the Elections Can Also Degrade The Dollar: Here’s How
Per CNBC, if Trump wins, he is most likely to prefer a weaker dollar, a frail currency prospect, to make US exports more competitive. A weak US dollar will also help strengthen local manufacturing units; hence, a weak US dollar will stimulate the policies of the policies of the Trump administration to help rejuvenate the sluggish US economy.
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US Dollar Foes: BRICS and ASEAN
The US dollar has long been attracting enemies, one-of-a-kind foes that are vying to derail its status as the global currency. With BRICS and ASEAN nations working on independent currency units of their own, such stark changes may impact the US dollar’s prestige in the long haul, derailing its status a notch.
