One day before the end of the American elections, everyone is waiting for a sign that will allow them to anticipate what is going to happen. AND a poll published this Saturday, which places Kamala Harris well ahead of what the rest of the polls predict, It hit the markets with such intensity that it sent bonds, the dollar and bitcoin tumbling.
The evolution of the American Treasury bond was particularly aggressive: the reference security, the 10-year maturity, reduced its profitability until it fell below 4.3%with a daily drop of more than 10 basis points. The purchases of sovereign fixed income are being driven by rising expectations that Harris will ultimately win the election, and the impact that would have on the Federal Reserve’s monetary policy. In fact, as the possibility of a Republican candidate victory has gained momentum in recent weeks, the market has erased its expectations of an aggressive Fed rate cut.
We must not forget that Donald Trump’s election promises carry a greater risk of inflation than those of Harris, due to his threats to reduce immigration and, above all, to increase tariffs at all levels. If there were more inflation, the Fed would have to stop the process of lowering rates and the bond yield would suffer upwards. However, if Harris ultimately prevails, it is likely that the market will calm down and adjust yields to maturity on bonds, as happened on Monday.
The “culprit” of this change in electoral expectations is Ann Selzer, considered the best pollster in all of the United States. Selzer specializes in Iowa, a small rural state in the center of the country, where he manages to obtain results with a tiny margin of error, both in general elections and during the famous “caucuses” which launch the presidential primaries . His polls are accurate even when everyone else is wrong, and he doesn’t let himself be fooled by numbers that are completely different from the consensus if that’s what his interviews tell him.
In 2016 and 2020, his polls in the days leading up to the election suggested that Trump would do better than anyone expected, and were the clearest sign that Hillary Clinton and Joe Biden would not get the vote. easy victories that everyone expected. But this year’s vote was completely different: Trump would go from an 8-point victory in this small rural state to a 3-point defeat to Harris, thanks to extraordinary support from women and the return of the white population, until ‘now the main bastion of the Republican. .
The investigation came as a “shock” among political analysts in the United States. If Selzer is once again correct in his predictions, the most likely would be a large and decisive victory for Harris.who would have a chance to win in states no one expected, like Ohio, and win absolute majorities in Congress and the Senate. A possibility which caused Trump’s options to fall sharply in the betting houses and which the markets began to take seriously.
Bitcoin and the dollar accompany the bond
The impact of the survey published by Selzer was not only felt on US bonds; In other listed assets, such as the dollar or bitcoin, the increase in the chances of winning the elections that Harris’ candidacy experienced also caused prices to move significantly at the start of the week.
An improvement in the chances of the Democratic candidate does not suit the dollar, which reacted with a fall of up to 0.7% for the US dollar index. Bloombergthe basket which weights the 10 most traded crosses of the American currency. The decline was driven by expectations that Trump’s policies will eventually boost the U.S. currency; as Harris gains weight in latest poll, Investors would adjust their portfolios based on a greater likelihood of a Democratic victory.
As for Bitcoin, the decline accumulated since the publication of the survey, of 2.57%, responds to investors’ confidence that Trump could be the best candidate for the cryptocurrency, due to the support he has brought to Bitcoin in recent months. currency, trying to win the favor of investors in the world of cryptocurrencies.
