Breaking: 101.50 Gives Way as US Dollar Falls on Early Midterm Signs of Democratic Gains

101.25: US Dollar Index Slides in Early Asian Trading on Wednesday.
Control of Congress for the final two years of Trump’s term hinges on the midterm elections in which Americans voted on Tuesday.

101.25 is the level under selling pressure for the US Dollar Index (DXY). The index is trading near that mark early in Wednesday’s Asian session, with traders awaiting US midterm election results later in the day for fresh direction.

With polls already closed in some early states, Americans are casting midterm ballots that will serve as a verdict on President Donald Trump's second term.

TMGM Analysis: Financial Market News, Economic Calendar & Market Insights

Live data from The Associated Press (AP) show that 60 of the 435 seats in the US House of Representatives have been called. Democrats have secured 42 seats, while Republicans have taken 18.

In Georgia, Democrat Jon Ossoff has secured a second term in the US Senate by defeating Trump-backed challenger Mike Collins. Holding the state is crucial to Democrats' efforts to regain Senate control.

US midterm elections: key questions

US midterm elections: which offices are contested?

Held at the midpoint of a president's four-year term, US midterms are federal elections in which voters elect all 435 House of Representatives members and about one-third of the Senate. Many states also hold votes for governors and other state and local officials.

2026 midterms: what is the election date?

Tuesday, 3 November 2026 is Election Day. Under federal law, the vote takes place on the Tuesday following November's first Monday. Many states already have early and postal voting under way.

US midterms: why congressional control matters

Control of both chambers of Congress for the final two years of President Donald Trump's term is determined by the midterms. The party with a majority sets legislative priorities and selects committee leaders. In the Senate, it also controls the confirmation of judges and senior officials.

2026 midterms: is the presidency at stake?

No. Presidential elections take place every four years, with the next scheduled for November 2028. Often viewed as a referendum on the incumbent president's party, midterms have historically tended to cost that party seats in the House.

2026 midterms: potential US dollar impact

A limited, temporary US dollar response is what most analysts anticipate, rather than a sustained trend. Markets broadly regard a divided Congress as the base case, with that outcome already partly reflected in prices. The impact on Treasury yields may be more pronounced. Results that strengthen expectations for fiscal stimulus typically push yields and the US dollar higher; legislative deadlock that curbs fresh spending can depress both. Disputes over funding or the debt ceiling can also give the dollar a brief safe-haven boost. Across a six-to-twelve-month horizon, economic growth and Federal Reserve policy carry more weight than the election result.

Midterm elections: the historical pattern for stocks

Weakness ahead of midterms and strength afterwards have historically characterised US equity performance. Since 1950, the S&P 500 has recorded gains in the 12 months following all 19 out of 19 midterm elections, averaging about 15%. Analysts attribute this pattern to the decline in uncertainty after results emerge. Past performance does not guarantee future returns, and some strategists note that high valuations in 2026 could test the streak.

Divided Congress: market benefits and risks

By reducing the likelihood of sweeping tax, spending and regulatory changes, legislative gridlock has often made divided government welcome in markets. With a Republican president in office, the S&P 500 has historically performed well in the years after midterms that divide congressional control. Funding deadlines, debt-ceiling disputes and congressional investigations remain risks that can increase short-term volatility.