Market confidence wavered as analysts weighed the implications of a divided government on President Trump’s legislative agenda. Commerzbank foreign exchange analyst Volkmar Baur noted that the Democratic majority may decelerate investment in AI infrastructure and data centers, tempering the capital inflows that previously buoyed the greenback. Against the Swiss franc, the dollar touched an eight-week low of 0.8124, while the euro and sterling climbed to three-week and seven-week highs, respectively.

Despite the immediate decline, some market observers caution against predicting a long-term slump. Danske Bank analyst Kirstine Kundby-Nielsen suggested the election outcome might eventually stabilize the dollar by increasing fiscal predictability and reducing the risk of deficit-expanding policies. While the president maintains authority over foreign and trade agendas, the new congressional makeup effectively places guardrails on nominations and spending, creating a complex outlook for the currency’s medium-term trajectory.