Bitcoin, Dollar soar while Asian markets struggle in the wake of Trump’s victory

Asian markets dipped again on Wednesday as concerns mount over the potential impact of Donald Trump’s presidency on both the Chinese and global economies.

Traders are worried that his proposed policies could reignite inflation in the US.

The prospect of rising prices, driven by tax cuts, import tariffs, and relaxed regulations, has strengthened the US dollar, which has been climbing since Trump’s election victory last week.

In addition, traders are closely monitoring bitcoin, which came close to surpassing $90,000 for the first time. However, many are betting that the cryptocurrency will hit $100,000, fueled by Trump’s pro-crypto campaign promises.

After an initial rally following Trump’s return to the White House, Asian markets have pulled back this week as his cabinet picks start to emerge. The appointment of China hawks to key positions has sparked concerns about a renewed trade war between the US and China.

Meanwhile, Beijing faces challenges in reigniting domestic growth. Despite unveiling a series of measures in late September, markets were disappointed with the lack of new announcements at a highly anticipated meeting on Friday.

Uncertainty about the economic outlook heading into 2025 weighed on Asian equities, with major indexes in Hong Kong, Shanghai, Tokyo, Sydney, Seoul, Singapore, Taipei, Wellington, Manila, and Jakarta all falling.

This decline came after Wall Street’s negative performance, with all three major US indexes finishing in the red after a week-long rally to new record highs.

Bitcoin stood at $88,404, just above the $88,000 mark. The US dollar continued to strengthen against its peers, hitting a one-year high versus the euro and pushing back towards 155 yen.

The dollar’s rise is partly due to traders reducing expectations for Federal Reserve rate cuts after Trump’s win, with two rate cuts now seen by June, compared to the previously forecasted four, according to Bloomberg.

Attention is now on the release of US consumer price data for October, expected later today. The market will be watching for any signs of inflationary pressure, which could influence the Federal Reserve’s plans for interest rates when it meets in December.

Key figures around 0230 GMT:

• Tokyo – Nikkei 225: DOWN 1.1% at 38,953.44
• Hong Kong – Hang Seng Index: DOWN 1.1% at 19,626.71
• Shanghai – Composite: DOWN 0.4% at 3,409.38
• Dollar/yen: UP at 154.68 yen from 154.59 yen
• Euro/dollar: UP at $1.0626 from $1.0625
• Pound/dollar: DOWN at $1.2747 from $1.2748
• Euro/pound: UP at 83.37 pence from 83.34 pence
• West Texas Intermediate: UP 0.1% at $68.17 per barrel
• Brent North Sea Crude: UP 0.1% at $71.94 per barrel
• New York – Dow: DOWN 0.9% at 43,910.98
• London – FTSE 100: DOWN 1.2% at 8,025.77