The week ahead 05.11.2018
This week provides the usual slew of data, some out of the UK this morning, followed by an assortment of data from Australia & New Zealand that will doubtless be awaited with interest only among a few specialist traders. Thursday brings us the US Federal Reserve decision and the FOMC statement.
However none of the above is particularly relevant this week as once again politics will dominate. Tomorrow brings us the U.S. Mid-term elections. These are held every 4 years and are timed, as the name suggests, to fall half-way through the of the current U.S. President’s term in office, with all 435 seats of the House of Representatives (the lower chamber of the U.S. Congress) up for grabs, along with an additional 35 of the 100 seats in the Senate (the upper chamber). These are usually viewed as a means of gauging voter approval, although given that the President’s opponents in the Democrat Party like to style themselves ‘the Resistance’, it’s difficult to see view these Mid-Terms in quite the same way. The two main Parties (Greens are irrelevant) have rarely been more polarised, so any meaningful interpretation of the results as a referendum on the effectiveness (or otherwise) on the President will be difficult to draw. This is simply a turnout battle. Despite having most of the media and a significant number of high-profile talking heads on their side, the general public are perhaps not quite as easy to manipulate as might have previously been the case. One only has to look at the attendance at Trump’s rallies to see that he remains an extremely popular figure, and for all the talk of a ‘blue wave’ we’ve yet to see any substantive criticisms beyond the synthetic media hysteria. A bad result for Democrats would drive the final stake through the heart of Hillary Clinton’s Presidential ambitions to such an extent that holding these votes on October 31st might have been much more appropriate.