Analysts see US dollar rout on Trump win

NEW YORK: The US dollar will plunge more than three per cent against the yen in the wake of an election victory for Donald Trump, say the most-accurate currency forecasters.

Within 24 hours, the greenback will drop to 100 yen or lower if Trump is voted president, according to the majority of the top 10 foreignexchange analysts in Bloomberg’s third-quarter rankings. If Hillary Clinton wins, they see a 1.5 per cent advance.

The survey of leading currency analysts shows that even the biggest and most liquid global markets face sharp swings and volatility in the aftermath of yesterday’s vote, with repercussions set to spread around the world.

“Currency markets are long the US US dollar and not positioned for a Trump victory, so there may be panic selling of US dollar and buying of safe-haven currencies,” said Scott Petruska, a senior adviser in Newton, Massachusetts at SVB Financial Group, the sixth most-accurate currency forecaster in a Bloomberg analysis.

He sees the US dollar falling to 99.50 yen 24 hours after a Trump win, compared with 103.12 last Friday, while the greenback would rally to 105.25 on a Clinton victory.

Bloomberg asked the 10 most-accurate currency forecasters from its quarterly assessment to predict where the US dollar would trade versus the yen and the euro 24 hours and seven days after the election.

The one-day reaction to a Trump triumph would weaken the US dollar to US$1.1328 per euro from US$1.1141 last Friday, while a Clinton victory would see the greenback gain to US$1.1006, according to the average of nine estimates.

The seven-day results showed a Trump win would weaken the US dollar to 99.06 yen and US$1.1389 per euro. A Clinton victory would boost the greenback to 104.78 yen and leave it little changed at US$1.1014 per euro during the same time period. Bloomberg