Bitcoin surged to a record high of $75,000 on Wednesday, fueled by growing investor confidence in a potential Donald Trump victory in the US presidential race.
As Trump gained key swing states necessary for a path to the White House, the markets responded positively, anticipating the economic impact of his policies, including tax cuts, tariffs, and inflation-driven growth.
Despite a tight race, Trump appeared to be gaining an edge over Vice President Kamala Harris, with both candidates securing expected wins in their strongholds.
However, Trump’s success in swing states, including Georgia, North Carolina, and crucial battleground Pennsylvania, significantly boosted the so-called “Trump Trade.”
The prospect of Republicans regaining control of the Senate further fueled optimism around Trump’s economic agenda. Traders are betting on sweeping tax cuts, deregulation, and more tariffs, which could bolster the US dollar.
The greenback climbed 1.5% to its highest level since July, hitting 154.33 yen, while also appreciating against the euro and Mexican peso.
Bitcoin followed suit, climbing more than $6,000 to break its previous all-time high, reaching $75,371.69.
The cryptocurrency’s rise is seen as reflecting investor sentiment tied to Trump’s policies, with many viewing a Republican-controlled government as favorable for digital assets.
Trump’s pledge to make the US the “bitcoin and cryptocurrency capital of the world” resonated with traders, who also anticipate his push for technological innovation under tech entrepreneur Elon Musk.
Experts suggest that a Republican sweep of both Congress and the White House would likely lead to higher growth and inflation expectations, driving up both the dollar and Treasury yields. However, some caution that this could create volatility in the markets, depending on the scope of policy changes.
The Federal Reserve is also under scrutiny as Trump’s economic plans, considered inflationary, may complicate efforts to manage inflation.
Meanwhile, the US stock market, buoyed by the dollar’s strength, saw gains across major indices, though Asian markets showed mixed results due to concerns about a possible trade war with China under a Trump presidency.
Despite positive momentum in markets like Tokyo and Sydney, Hong Kong’s markets fell sharply, reflecting concerns over Trump’s stance on China. His pledge to escalate tariffs on Chinese goods has raised tensions ahead of a critical Chinese economic meeting to discuss stimulus measures amid the country’s ongoing debt crisis.
As the global community keenly watches the unfolding election, traders continue to adjust their positions, navigating a turbulent political and economic landscape.
– Key figures around 0710 GMT –
Dollar/yen: UP at 154.21 yen from 151.60 yen on Tuesday
Euro/dollar: DOWN at $1.0711 from $1.0930
Pound/dollar: DOWN at $1.2853 from $1.3035
Euro/pound: DOWN at 83.32 from 83.82 pence
Tokyo – Nikkei 225: UP 2.6 percent at 39,480.67 (close)
Hong Kong – Hang Seng Index: DOWN 2.6 percent at 20,467.69
Shanghai – Composite: DOWN 0.1 percent at 3,383.81 (close)
West Texas Intermediate: DOWN 1.9 percent at $70.59 per barrel
Brent North Sea Crude: DOWN 2.0 percent at $74.03 per barrel
New York – Dow: UP 1.0 percent at 42,221.88 (close)
London – FTSE 100: DOWN 0.1 percent at 8,172.39 (close)
