There is increasing speculation that a Romney victory in the US Presidential election could lead to an immediate end to the Bernanke era. Romney has said that, should he win the election, he will replace Helicopter Ben when his second term ends in January 2014. Market speculation is that Mr Bernanke wouldn’t wait that long, and that he will resign before Romney could take office.
Romney would look to put someone with more hawkish credentials in the Fed hot seat and this would have a major impact on world financial markets. US equity markets would fall heavily as stimulus is removed dragging worldwide risk sentiment lower and the USD would rally as prospects of further QE are diminished and long-end US rates start to rise. Sounds like yet more reasons to be selling any AUD/USD rally!