USD Under Pressure of Midterm Election Results

Forex News

The American dollar fell significantly versus major currencies on results of midterm elections in the US. The dollar index, which measures the greenback’s strength against a basket of six major currencies, fell by 0.38% to 95.75. Last week, the index hit a 16-month high of 96.98, amid expectations that the Fed will continue to raise interest rates this year and beyond as the US economy remains strong.

As it became known, Democrats won control of the House of Representatives while Republicans tightened their hold on the Senate in the US midterm elections. With a majority in the House of Representatives, Democrats will be able to investigate Trump's tax returns and potential conflicts of interest, as well as challenge his actions in Saudi Arabia, Russia, and North Korea. They can also force Trump to cut his legislative ambitions.

The euro strengthened versus the US dollar, and the EUR/USD pair added 0.35% to 1.1467. The Japanese yen was also higher, with USD/JPY sliding 0.23% to 113.17. The GBP/USD rose to 1.3140 after gaining 0.31% (the highest level since October 17).