US Midterm Elections: Economic Impact and Consequences for Switzerland
The United States will hold congressional elections on November 3, 2026, with all 435 seats in the House of Representatives and 35 of the 100 Senate seats at stake. The outcome of these midterm elections will dictate the remaining political maneuvering room for President Donald Trump and carries significant economic implications for Switzerland, such as U.S. tariffs, the dollar exchange rate, and financial markets. These elections are traditionally viewed as a performance barometer for the president, and with only 32 percent of Americans satisfied with the Trump administration’s work according to Reuters/Ipsos polling, the political stakes are high.
Shifting Power Dynamics in Washington
Midterm elections traditionally serve as a referendum on the sitting president. Data from the NZZ indicates that the Republican party currently holds a narrow majority in both chambers: 218 to 215 seats in the House and 53 to 47 in the Senate. According to projections cited by Heute, the Democratic Party holds a strong advantage in the House, with some models suggesting they could gain enough seats to secure a majority. The race for the Senate remains more competitive, though analysts note a possible path for a Democratic takeover. Current models from Decision Desk HQ suggest the Democrats could reach 234 seats in the House compared to 201 for the Republicans, while the Senate race could shift to 51 seats for Democrats and 49 for Republicans.
The potential for a power shift has created scenarios for the next two years. If Democrats win both chambers, President Trump’s legislative agenda would face constraints. Verlieren seine Republikaner die Mehrheit in nur einer der beiden Parlamentskammern, könnten die Demokraten viele seiner politischen Pläne blockieren. In such a case, the president would risk becoming a “lame duck,” a term used for leaders whose influence wanes and who struggle to pass initiatives. Trump would be forced to seek compromises or face legislative gridlock, as new federal laws require approval from both chambers. Democrats could also lead investigative committees, subpoena government officials, and demand documents. While Trump would remain president, he would face a significant loss of power, as a third term is prohibited by the U.S. Constitution.
Trade Policy and Export Vulnerability
For the Swiss economy, the election outcome is closely linked to future trade barriers. Tariffs increase costs for exporters and complicate long-term corporate planning. Migros Bank economist Santosh Brivio notes that tariffs are ultimately not postcards with friendly greetings,
as they increase costs for sectors like machinery, watchmaking, and pharmaceuticals. Clientis notes that the president would retain veto power and could continue to govern via executive order.
However, a loss of congressional control would not fully neutralize the president’s influence.
Stock Markets Often Gain After Midterm Elections
The impact on the Swiss franc and the U.S. dollar remains a point of debate among financial institutions. Lombard Odier notes that the direction of the greenback remains open.
VP-Bank chief economist Thomas Gitzel argues that the specific party composition of Congress is less important for stock market performance than broader macroeconomic factors. Historical data from the past 75 years shows that the S&P 500 has consistently gained an average of 10 percent in the 100 days following midterm elections, regardless of which party wins.
Trump May Contest Results as Observers Are Excluded
Concerns regarding the aftermath of the vote extend beyond economic policy. President Trump has raised the possibility that a Republican loss could be contested. According to the NZZ, the U.S. government did not invite election observers from the Organization for Security and Co-operation in Europe (OSZE) for the first time in 24 years. Meanwhile, the administration is facing a Latino-backlash
in disputed districts, attributed in part to the president’s strict migration policies.
Trump Campaigns in Safe States Before November 3
In the final stretch, President Trump had planned 35 appearances in the most contested states. However, recent stops have included Durant, Oklahoma, and Alabama—areas where Republicans are already heavily favored. As the November 3 date approaches, many Americans are already casting ballots via early and mail-in voting. Initial results are expected in the early hours of November 4, though close races may require days to finalize.