How the US midterms could reshape the outlook for the dollar, bonds and Wall Street

The upcoming U.S. midterm elections could significantly impact financial markets, with polls indicating a potential Democratic victory. This shift may lead to increased scrutiny of AI and influence the 2028 presidential race, while concerns over the national debt persist. Analysts suggest that a Democratic-controlled Congress could restore health insurance subsidies and revive tax debates, affecting investor expectations. However, Trump's veto power remains intact, limiting drastic policy changes. The political landscape may lead to lower bond yields due to challenges in passing new spending packages, but the overall direction of policies might not change significantly. Investors are advised to prepare for potential fiscal risks and a weaker dollar.