The US Mid-Term Elections provided a massive swing to the Democrat Party, with convincing wins in both the House and the Senate. Markets love divided Government and gridlock. Democrats now control the House, which is the purse strings, and the Senate. The Senate is oversight and thus will tie the Trump administration up, ensuring neither party will act without co-ordination and agreement. Markets loved the result, with equities soaring, while bond yields and the US Dollar tumbled. The EUR surged back above 1.1200, while the GBP pushed above 1.3450.The softer reserve allowed further stabilisation of commodity currencies, with the AUD pushing back towards 0.7000, while the NZD consolidates 0.5600. NZ Unemployment numbers were released yesterday, with a spike up to 5.7%, not good news ahead of the national election on Saturday.
