The Daily Update - US elections / China reserves

So, after all the shenanigans over the last few days the FBI says Clinton is clean. The FBI announced that they would not be bringing any criminal charges after investigators worked ‘round the clock’ analysing newly discovered emails (all 650,000 of them), the same verdict they came to in July when she was first cleared of any criminal charges with regards to her use of a private email server whilst secretary of state.

Whilst the announcement will be very welcome to the Democratic candidate, she will be mindful that over 40m Americans have already cast their vote, many in the last 10 days, when FBI Director James Comey first told Congress about the newly discovered emails. However, she will hope that reports suggesting Latino voters are turning out early in battleground states including Florida, Arizona and Nevada are true.

As you can imagine, Donald Trump was not best pleased at the FBI’s announcement. In a rallying speech in Detroit he said ‘Right now she is being protected by a rigged system. You can’t review 650,000 new e-mails in eight days. You can’t do it, folks. Hillary Clinton is guilty. She knows it, the FBI knows it, the people know it. And now it’s up to the American people to deliver justice at the ballot box on Nov. 8’ However, former FBI forensic experts say sifting through the emails in 8 days was ‘not rocket science’ adding 'We’d routinely collect terabytes of data in a search. We’d know what was important before we left the guy’s house.'

On the back of the news US futures jumped after 9 straight days of decline (the longest run of losses since the 80s) with the Mexican peso rallying. The yen, gold and US Treasuries all came under pressure as investors took on more risk in the wake of the FBI announcement.

Also this morning China announced its FX reserves fell by USD45.7bn in October, in line with forecasts. However most of the fall (nearly USD30bn) was due to valuation effects, whilst PBoC intervention only accounted for approximately USD10bn to USD15bn.