FX Update: The dollar took a clobber on U.S. political news
FX Update: The dollar took a clobber on U.S. political news, specifically that Democrat Doug Jones won the election for an Alabama senate seat, the first time there's been a Democratic Senate member from that state since 1992. The thinking is that this will erode the chances for corporate-friendly legislation in the U.S., with the Republican advantage in the Senate ebbing to 51 to 49 from 52 to 48 (aside from the fact that the election result bods badly for the GOP in the mid-term elections in November 2018) . USD-JPY took a 30-pip clobber on news, hitting a low of 113.12 before subsequently settling around the 113.35 mark, which is about 15 pips lower versus yesterday's closing levels in New York. EUR-USD recouped to the mid 1.17s, up from yesterday's low at 1.1717. AUD-USD and NZD-USD clocked one-week and one-month highs, respectively. The dollar may find support from the Fed today, as, analysts think, a discounted 25 bp rate hike will be accompanied by sufficiently hawkish guidance to stimulate the odds for a follow-up tightening in March next year.