US elections are near-term external risk event for Asia FX - Nomura

Nomura Global Markets research says the US elections (8 November) remain another near-term external risk event for Asia FX.

Key quotes

As of 24 October 2016, there was a relatively broad consensus among clients that Hilary Clinton would likely win the US presidential election.

However, the main focus was on the House, where a small Republican majority would likely be viewed as a more favourable outcome for risk markets. There is a belief that the Republicans will have to rebrand themselves and not maintain their stance of simply blocking the policies of Democrats.

A small Democrat majority in the House would be viewed as negative for risk, given the likely push for increased taxes and regulation. There was also a general view that protectionism would increase, regardless of who wins the presidency.