Investing.com – There is no doubt a violent and powerful storm that could amount to a hurricane more powerful than the delta and the tsunami .. It is the US election that billions of people on the planet await.
The most important and influential event at the present time is rivaled only by the second wave that has begun to appear from the Corona virus.
Between markets that support Trump’s victory or lean towards the Democratic Blue Biden, the dollar and the dollar stand face to face in the test of stress and pressure who chooses investors in this difficult time.
It seems that the answer was quick, as everyone clung to the yellow metal, while investors gave up their bet, even temporarily, on the dollar, which waited and is still waiting for a stimulus plan. It seems that it will not see the light before the American elections, but will wait until the beginning of 2021.
gold
Gold prices rose globally when settling trading on Friday, with losses in the US currency and stocks.
December delivery price rose 0.6% to $ 1,879.90 an ounce.
During Monday’s trading, gold rose by more than $ 13, increasing by 0.8% to levels of $ 1897 an ounce.
And yellow metal futures for December delivery increased to levels of $ 1,886, up $ 9.
Dollar
On the other hand, the dollar fell during today’s and Friday trading hours, hours before the US elections, and after statements about postponing the stimulus plan until after the presidential elections.
During today’s trading, it retreated by 8:30 PM EST by 0.1% to $ 94 levels.
The dollar fell against 0.3% to 1.164, and against the yen 0.02% to $ 104.65, and against the sterling 0.12%, down to $ 1.2935.
On Tuesday morning, the Americans will begin the voting process to elect the president of the United States of America, between the Republican candidate and the incumbent President Donald Trump, and the Democratic candidate, Joe Biden.
Goldman Sachs (NYSE ???? says that the US dollar could fall 15% by the end of 2023, and the blow is likely to come stronger.
The investment bank memo came after a grueling week in global markets before the US elections that will take place tomorrow, Tuesday, and the world closed its doors again, and the features of agreement on any stimulus packages before the presidential elections faded.
Zach Pandal of GlobalFX says there are many reasons for the depreciation of the US currency, and we think it is overvalued by between 10% and 15%.
With real interest rates continuing to be negative in the US, along with a strong economic recovery, conditions will be similar to a weakening US dollar.
The reasons for the decline in the US dollar are due to the following reasons:
The course of the epidemic, vaccine developments, election results, and the limited timeframe of the US election.
Investors are reluctant to embrace the idea of a lower dollar until the end of the year, and until 2021, with increasing uncertainty about the US elections, the health of the global economy, and how the US economy is performing relative to other markets. Not many investors are focusing on the dollar’s weakness in the coming months.
Pandal said that the US election results will not change his view on the path of the US dollar, but it may accelerate the path, for example if the Democratic Party wins, the dollar will decline quickly.
If the American people elect former Vice President, Joe Biden, they would pursue different foreign policies, especially with regard to Sino-American relations, and this might increase the strength against the US dollar.
The Democrats will also approve strong stimulus packages, if the “blue wave” vision materializes, adding to the weakness of the US dollar. The dollar may also weaken to increase investment demand for the purpose of financing the US budget deficit, especially if the Federal Reserve kept interest rates low.
If Trump is re-elected, the dollar will eventually weaken, as the focus shifts to the Corona epidemic.
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