The dollar soared to a four-month high today after Republican Donald Trump won the U.S. presidential election, with policies on immigration, tax and trade expected to spur higher U.S. growth and inflation.

Trump beat Democrat Vice President Kamala Harris to retake the White House while Republicans also won a U.S. Senate majority. Control of the House of Representatives remains in question, with Republicans currently holding a majority.

A full sweep by Republicans would allow the party to make larger legislative changes and in turn would likely provoke larger currency moves.

Trump’s policies on restricting illegal immigration, enacting new tariffs, lower taxes and deregulation may boost growth and inflation and crimp the Federal Reserve’s ability to cut rates.

“This can push inflation higher and force the Fed to a slower easing path, which is dollar-positive,” said Nikos Tzabouras, senior market specialist at trading platform Tradu.

The euro zone, Mexico, China and Canada are viewed as being at risk of potential new tariffs, which may hurt economic growth in the regions. That would widen their interest rate differentials with the United States and weigh on their currencies.

The euro may also be weighed down by political uncertainty in Germany.

German Chancellor Olaf Scholz

sacked his Finance Minister

Christian Lindner today after weeks of wrangling over the economic direction of the government.

Newspaper Bild had earlier reported that Lindner had recommended early elections as a solution to the budget impasse, a proposal Scholz had rejected.

Nick Wood, head of execution at MillTechFX and Millennium Global notes that currency moves today have been orderly, with some market participants holding relatively light positions heading into the U.S. election. “It seems like elements of the market were actually kind of running quite light in terms of risk, so therefore they can be a little bit more patient in terms of entering positions as opposed to feeling like you’re the wrong side of something and having to exit a position at a speed,” he said.

A complicating factor for the dollar outlook longer term, meanwhile, could be that Trump has stated a preference for a weak U.S. currency.

“Both this year, but also during his previous stay at the White House, he had essentially challenged the longstanding strong dollar mantra, because he prefers a weaker currency to help with exports and American economic activity,” said Tzabouras.

“And he had also called for lower interest rates, so this could actually pose headwinds for the dollar in the long run as these policies begin to take shape.”

The dollar index was last up 1.66% at 105.09 and reached 105.44, the highest since July 3. The euro dropped 1.78% to $1.0735 and got as low as $1.0683, the lowest since June 27.

The greenback rose 1.92% to 154.5 Japanese yen and reached 154.7, the highest since July 30.

The Japanese yen could now approach levels that prompted officials to intervene and shore up the currency earlier this year.

Japan’s chief cabinet secretary Yoshimasa Hayashi said today that the government intended to closely watch moves on the foreign exchange market, including speculative moves, with a higher sense of urgency.

Trump has also expressed favorable views on cryptocurrencies, which helped to lift bitcoin more than 10% to a record high of $76,134.

The Fed is expected to cut rates by 25 basis points at the conclusion of its two-day meeting on Thursday and investors will also watch for any new clues on whether the U.S. central bank could pause cuts in December.

A much stronger-than-expected jobs report for September led investors to pare back expectations on how many times the Fed is likely to cut rates. A much weaker-than-anticipated report for October has raised some doubts over this view though this data was clouded by the impact of recent hurricanes and labor strikes.

Traders are now pricing 71% odds the Fed will also cut in December, down from 77% on Tuesday, according to the CME Group’s Fed Watch Tool.

The Bank of England is expected to cut rates by 25 basis points on Thursday, while the Riksbank is seen easing by 50 basis points and the Norges Bank is expected to stay on hold.

Additional reporting by Samuel Indyk and Kevin Buckland.