As “The Trump trade” Weakened, the Bloomberg Dollar Index and Bitcoin Slumped

On Monday, the Bloomberg Dollar Index once fell nearly 0.7%, getting the biggest drop since August. The dollar against G-10 currencies fell, with the Norwegian krone and Australian dollar appreciating more than 0.6% once. The yen once appreciated 0.7% against the dollar. The onshore RMB at one point rose 0.6%, marking the biggest gain since early August. The dollar's losses have now narrowed slightly.

As of November 1, 2024, the Nikkei 225 closed at 38,053.67, indicating a decrease of 2.63% compared to the preceding trading session. This decline aligns with a larger trend, influenced by investor responses to diverse economic indicators and geopolitical considerations. The Nikkei 225 also concluded the day's trading in Japan with a decrease of 2.63%.

It is worth mentioning that a weaker dollar is a key signal for the market, suggesting that investors may be reducing their confidence in a Trump victory. The most notable features of the “Trump trade” are higher U.S. Treasury yields and a stronger U.S. dollar. In addition, Trump also favors cryptocurrencies.

Likewise, Bitcoin once dipped more than 5% from last week's high of $73,500 to $68,573.6.

According to media reports, a much-anticipated poll released on Saturday showed that U.S. Vice President Harris was slightly ahead of former President Trump in Iowa. Analysts believed that Iowa was a firm red state that neither candidate focused on in their final campaigns. Forecasters saw little chance of a reversal in Iowa. The latest batch of U.S. election polling data now shows no clear advantage between Harris and Trump.

Moreover, India's Nifty 50 index once fell 2%, having the biggest drop since October 3. In October, foreign investors sold Indian stocks of $10.4 billion, becoming the highest monthly outflow of foreign capital. As of its market close, Nifty 50 index was down 1.7%.