The Indian rupee's continues recovery drawing support on Wednesday from a revival in equity inflows and a dip in the dollar amid US election results indicating momentum for the Democratic Party. While US midterm results are not expected to cause structural shifts in FX, the dollar may face short-term pressure if Democrats secure both the House and the Senate. The recent weakness in the AI-led trade has provided support to Indian equities, which are seen offering a degree of hedge. Indian equities have underperformed over the past several months, partly because the AI-related trade has drawn foreign capital to other markets. Foreign investors poured more than $700 million into Indian equities on Tuesday, taking purchases over the past three sessions to around $1.5 billion. The dollar fell sharply against major currencies on Wednesday as early results from the US midterm elections showed Democrats making strong gains in their attempt to wrest control of Congress from President Donald Trump's Republicans. The immediate market reaction from investors was to sell stocks, rush out of the US dollar and seek safety in Treasuries. The euro firmed 0.5% to $1.1249, while the yen strengthened 0.7% to 157.63 per US dollar. The dollar index , which measures the greenback against a basket of six currencies, fell 0.3% to 101.4. Prediction markets signaled growing expectations of a Democratic sweep of the US Congress. investors are also watching the risk of an escalation in the Middle East depending on the election outcome. Sterling rose 0.4% to $1.3460, with traders eyeing the Bank of England's policy announcement on Thursday. The central bank's Monetary Policy Committee is expected to raise interest rates for the first time since August 2023. Against the Swiss franc , the dollar weakened 0.9% to 0.8133. Oil prices slipped in early trade on Wednesday as investors awaited the results of the US Midterm Elections and their potential impact on peace talks in the Middle East, even after industry data showed US crude stocks unexpectedly fell last week. Brent futures fell 26 cents, or 0.25%, to $103.34 a barrel by 0157 GMT. US West Texas Intermediate crude futures fell 53 cents, or 0.55%, to $95.56. In the previous session, Brent eased more than 1% to its lowest level in nearly four weeks as traders weighed talks to end the wars in Ukraine and Iran. Gold prices edged higher on Wednesday, supported by a softer US dollar ahead of the outcome of the US midterm elections, while investors awaited the non-farm payrolls data later this week for clues on the Federal Reserve's policy path. Spot gold was up 0.1% to $3,931.24 per ounce by 0306 GMT, while US gold futures for December delivery steadied at $3,941.40. A weaker USD and a punchy decline in both nominal and real US Treasury yields are clearly providing support for gold. the demand for protection against a potentially more unpredictable and confrontational Trump administration looks to be providing a compelling backdrop for gold buyers. Markets now await the US non-farm payrolls report due on Friday. India's gold demand is expected to fall to a six-year low in 2026, as elevated prices weigh on ?jewellery sales and investment demand moderates. Among other metals, spot silver fell 1.3% to $49.12 per ounce, platinum slipped 1.9% to $1,389.54 and palladium dropped 0.6% to $928.23. www.eforexindia.com......