Dollar and bitcoin soar as Trump declares victory

The dollar, bitcoin and yields on US government bonds have risen sharply and Wall Street is forecast to open higher after Donald Trump declared victory in the US presidential race.
Buoyed by Trump’s inflationary tariffs, tax cuts and pledge to cut red tape, the dollar has risen against a basket of major currencies. The dollar index — which tracks the currency against six major currencies including the pound, euro and yen — was up 1.6 per cent overnight.
The dollar and bond yields had been rising since the end of September as investors bet on the so-called Trump trade in expectation that his policies on immigration, tax cuts and tariffs would strengthen the dollar and push up inflation, leaving interest rates higher for longer.
The dollar had its biggest monthly gain in more than two years last month and a sell-off in bonds pushed down prices and boosted yields.
• US election results 2024 live: Trump hails ‘magnificent victory’
The expectation of tariffs has hit the currencies of America’s major trading partners, with the euro, pound, Japanese yen and China’s yuan all down against the dollar. Trump has threatened to impose tariffs on all imports, including 60 per cent on everything from China, which economists warn will end up as a tax on the American people and increase inflation.
The pound was trading down 1.1 per cent against the dollar at $1.29 and yields on UK government bonds fell 1 per cent to 4.5 per cent. The FTSE 100 rose 115 points, or 1.4 per cent, to 8288.31 as companies that make their money in dollars rose strongly. Ashtead, the equipment rental company, rose 6 per cent; the hotel chain IHG gained 5 per cent; and the aero-engine maker Rolls-Royce was 4.7 per cent higher.
Major European stock markets rose, with Germany and France up 1.2 per cent and 1.77 per cent respectively. Japan’s Nikkei 225 closed up 2.6 per cent and China’s SSE Composite was trading flat but Hong Kong’s Hang Seng fell 2.2 per cent.
Wall Street is expected to open higher on hopes of promised tax cuts and less corporate regulation, with Dow Jones, S&P 500 and Nasdaq futures up 1.6 per cent, 1.8 per cent and 1.5 per cent.
Bitcoin has also risen sharply, topping $75,000 at one point to hit a record high of $75,060 in overnight trading in Asia. A short while ago bitcoin was trading at $73,107, up 5.3 per cent. Traders believe that Trump’s return to the White House will usher in a softer regulation line on cryptocurrencies.