What If Trump and Biden Disputed the Election Result? Markets React
Conflict over the election result can lead to legal and political drama in which the presidency may be determined by a mixture of courts, state politicians, and Congress.
Despite the incomplete results in a number of vital states that may decide the outcome of the US presidential elections, President Donald Trump announced his victory over his Democratic opponent, Joe Biden, today, Wednesday.
This premature announcement came to confirm the concerns of Democrats that they expressed weeks ago, indicating that Trump is seeking to not accept the results.
Early vote data showed that Democrats voted by mail in much greater numbers than Republicans. And in states like Pennsylvania and Wisconsin that do not mail ballots until Election Day, experts say the preliminary results may favor Trump, while the mailing ballots counted at a slower pace are expected to work in Biden's favor.
So Democrats expressed concern that Trump would declare his victory, as he did today, before those votes were counted.
In addition, the convergence of results could lead to litigation over voting and vote counting procedures in critical states.
Cases filed in individual states could ultimately reach the Supreme Court, as happened in the Florida election in 2000, when Republican George W. Bush beat Democrat Al Gore by just 537 votes in Florida after the Supreme Court halted the recount.
How Would this Affect the Market?
USD/JPY Daily Chart
The pair is trading at support structure. Today, it bounced back from the upper line of the descending triangle. If we lose the support line, it will be so negative for the pair.
USD/CHF Daily Chart
The pair has been trading below all major moving averages. If there is a contested election, it may drop to 0.9000 level
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