US: It is Trump vs Biden – MUFG

Bernie Sanders yesterday announced the suspension of his campaign to win the Democratic Party presidential nomination which gave the dollar a modest lift in the immediate period after the announcement, per MUFG Bank.

Key quotes

“The removal of Sanders as a risk now leaves us the option of four more years of Trump or a new term with a far more moderate Democrat. For the equity markets a more palatable prospect.”

“Assuming that bad news on the economy means good news for Biden doesn’t really hold. There are though certainly greater risks for Trump and our assumption we outlined in January of a Trump victory over Biden in November is not as strongly held given current circumstances.”

“Presidents tend to do well during periods of crisis and this is partly why Trump’s approval rating has held up reasonably well. His approval rating has experienced a small bounce but it hasn’t jumped as much as expected based on the past performance of prior Presidents who have faced crises.”