As news outlets across the United States were calling the race in their favour, Republicans, and Donald Trump gave a victory speech to his supporters. Declaring victory in the long-waited U.S. election, Trump added that the dollar was one of the biggest winners, setting up one of its largest single-day gains against its primary peers since 2020. As he won key swing states, stock markets rose, and the EUR/USD exchange rate dropped below 1.08. The euro dropped on fears that planned trade tariffs in the Trump plan would hurt Europe’s economy.
While the outcome of the election is now a given, long-term implications are still unknown, and it would be safe to say market volatility will be in play for quite some time.
While the U.S. election has rightly taken centre stage this week, it’s not the only market-moving event on the docket.
Tomorrow, the Federal Reserve will release its next decision on interest rates. With another rate cut widely expected, comments and future guidance by Jerome Powell will dictate the direction of the dollar, and market players will be watching closely before executing their next moves.
In financial terms, that means for a €2 million purchase, U.S. clients are saving $30,000 compared to yesterday and about $110,000 compared to rates in September*.
One of the contracts that has been popular with U.S. clients is the forward contract. This will enable clients to lock their euros up to a year in advance by simply paying a small margin against the contract. This is a great hedging strategy and ensures that the client is fully protected against any adverse market movements.
If you’re a U.S. citizen considering purchasing your future home in the California of Europe, the Algarve in Portugal, over the next few months, now is an excellent time to contact us to review your options and help you save money while buying a property.
A wide range of Visa options is available. Talk to us!
* All information courtesy of Jimi Boake of Foreign Currency Partners Ltd.
