Forex News: U.S. Dollar Slides As Crude Oil Nosedives Following

U.S. Dollar Slides As Crude Oil Nosedives Following Democrats' Win In Mid-term Elections

(RTTNews) - The U.S. Dollar value moved lower on Wednesday as concerns of escalation in the U.S.-Iran conflict diminished after the mid-term election results showed a huge win for Democrats who seized control of both the houses in the U.S. Congress. As markets are betting on an end to the war, inflation worries faded and crude oil prices nosedived by nearly 8.00%.

Today, the U.S. Dollar Index DXY, which measures the Greenback against a basket of other major currencies, was last seen trading at 101.52, down by 0.34 (or 0.33%).

While against the Euro, the USD was trading at 1.123, down by 0.34%, against the GBP, the USD was trading at 1.347, down by 0.43%.

Against the USD, the Japanese Yen was trading at 158.419, up by 0.16%, the Swiss Franc was trading at 0.817, up by 0.44%; and the Canadian Dollar was trading at 1.398, up by 0.25%.

Against one unit of Australian Dollar, the USD was trading at 0.701, down by 0.58%.

Today, the results for the U.S. mid-term elections which were held yesterday revealed that the U.S. voters have largely voted in favor of the Democrats over the Republicans.

In a major setback to U.S. President Donald Trump, the Democrats secured 228 seats in the House of Representatives (where 218 is needed for a majority) and 54 seats in the upper house, Senate (where 51 is needed for control).

Surprisingly, the Democrats flipped nearly seven Senate seats to include Iowa, Texas, Kansas, Ohio, Maine, North Carolina, and South Carolina. Of note, Kansas did not elect a Democratic candidate for the past several decades.

The new candidates will assume office in January 2027. Democrats will gain more power to challenge the current administration while Trump retains his veto power.

Trump observed that his absence in the Ballot tilted the votes in Democrats' favor. U.S. Vice President JD Vance cited the Iran war as the main reason for the debacle.

Though Trump would remain in power for another two years, analysts view that Trump might tone down his aggressiveness in implementing his policies since the Congress might not offer support to his plans.

With markets anticipating an U.S.-Iran truce, crude oil prices went for a freefall by more than 8.00%. As a result, oil-linked inflation worries and the possibility for rate hikes vanished, weighing on the U.S. dollar.

However, economists caution that beyond today's election results, employment, earnings, and the decisions by the U.S. Federal Reserve would determine the trajectory of the U.S. dollar in the next few weeks.

According to the CME Group's FedWatch Tool, currently investors are betting on a 81.50% chance of a 25-basis-point interest rate hike at the upcoming meeting of the U.S. Federal Reserve on December 8-9 while the odds on the rates being held at the current level stand at 18.50%.

On the economic front, data from the U.S. Automatic Data Processing revealed that private jobs increased by 86,000 in October, exceeding market expectations of 69,000 and matching September's downwardly revised gain.

Mid-sized companies led with 33,000 new positions, followed by small firms with 28,000 and large businesses with 24,000.

The U.S. Mortgage Bankers Association of America Purchasing Managers' Index decreased to 131.40 on October 30 from 134.10 of the previous week.

In Canada, the data released by Statistics Canada today revealed a trade surplus of CAD 5.40 billion in September, the highest since May, widening from the revised CAD 5.00 billion of the prior month.

While exports edged up 0.20% to CAD 78.55 billion in September following a revised 3.20% increase in August, imports fell 0.30% to CAD 73.20 billion following a 2.20% decline in August.

The S&P Global Canada Composite Purchasing Managers' Index declined to 48.10 in October from 48.70 in September, marking its fifth consecutive month below the neutral 50.00 threshold, signalling a steep decline in private-sector business conditions.

Services PMI Business Activity Index edged down to 48.10 in October from 48.30 in September.

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