• EUR/USD is hit badly with Trump’s victory in the US presidential election in sight.
• The Fed is expected to cut interest rates again on Thursday but by a lower size of 25 bps.
• The Euro underperforms across the board as concerns over Eurozone economic growth have deepened.

EUR/USD slightly recovers to 1.0750 after nosediving to near 1.0700 in Wednesday’s European session, the lowest level in over four months. The major currency pair hits badly as Republican candidate Donald Trump appears to take the Senate from Democrats, with Grand Old Party (GOP) gaining an unconquered lead in key battleground states, according to The Associated Press. The agency shows that Trump is inches away from winning 270 seats, a level the party needs to cross to form the government.

A clear victory of Trump in sight keeps the US Dollar (USD) on the front foot. The US Dollar Index (DXY), which gauges Greenback’s value against six major currencies, rallies to near 105.30. Market action clearly shows that Trump’s victory is favorable for the US Dollar, which was already anticipated as the Republican candidate vowed to hike tariffs on imports and lower corporate taxes. A scenario that will boost overall business activity and labor demand and escalate inflationary pressures.