US election update: clarity, but not certainty
- With results continuing to trickle in as initial vote counts conclude, multiple news agencies declared Pennsylvania for Biden over the weekend, taking him over the 270 votes needed for an electoral college vote majority.
- President Trump has refused to concede defeat, pursuing recounts and legal challenges. The former appears unlikely to change the outcome, but the process of the legal challenges is more uncertain.
- The House appears on track for a Democrat majority.
- But the Senate is more uncertain and looks unlikely to be certain until early January. We expect a Republican majority in the Senate.
- A new President facing a divided Congress has not been seen in over 20 years.
- This will likely result in policy gridlock, blocking plans for fiscal stimulus in the short and medium-term and requiring more protracted monetary policy support.
- Yet President-elect Biden looks set to pursue a more multilateral approach on health, with the WHO, trade, with the WTO, and climate, with the Paris accord.