As the 2024 presidential election lies just five months away, TD Securities Global Head of FX and EM Strategy Mark McCormick joins Catalysts to discuss how Joe Biden and Donald Trump's tariff policies could weigh on the FX market.

"The concept of Trump winning is challenging just given the mandates or even the rhetoric around fiscal stimulus on corporate tax cuts, on tariffs. All of these things are inflationary. So, if you're running at above-target inflation and the central bank is trying to get less restrictive in trying to cut rates, and you have a macro policy coming from a presidential candidate that is inflationary, the markets have to recalibrate and have to rethink about what themes and what things are going to be driving at the moment," McCormick explains.

He adds that the current market is in a "Goldilocks environment," and if Trump wins, the markets will have to price in a risk premium and a strong dollar.

For more expert insight and the latest market action, click here to watch this full episode of Catalysts.

This post was written by Melanie Riehl