Residents and businesses in the Northeastern US are still slowly trying to return to normalcy.
Power and public transport were out for days for millions in New York City and surrounding areas.
Internet and mobile service has been erratic due to damage to data center sites in the region, as well as to power cables needed to keep cellular phone transmission towers online.
However, the New York Stock Exchange resumed trading on Wednesday.
How will the storm impact the US economy in general, and particularly, the USD?
The initial cost is still estimated to be between $30 to $50 billion in uninsured property damage and lost business activity.
When New Zealand and Japan suffered from devastating earthquakes, spending on rebuilding made up for the hit to economic activity, but this does not mean that the Hurricane won’t affect the USD.
Firstly, economic reports for the months of October and November will certainly be distorted by the Hurricane.
Even though the data will return to normal levels in the months to follow, the outcome of the October and November economic reports could cause erratic price action in the USD.
Probably, these numbers will show a decline in economic activity which could cap gains in USD/JPY but drive the Dollar higher against other currencies because of risk aversion.
Secondly, The Hurricane aided President Obama’s chance of reelection.
According to reports, President Obama’s election odds soared to 65%.
If Obama wins the election, the initial impact could be Dollar weakness, because of the perception that Democrats are less business friendly and because of concern that Obama will continue to face resistance getting the Congress to reach an agreement on how to handle the fiscal cliff.
Naturally, the USD is influenced by many other factors, particularly overall risk appetite or lack of it.
On Wednesday, German Finance Minister Schaeuble said a decision on Greece by November 12th is ambitious, meaning that Greece may not get its next bailout payment unlocked at the November 12th Euro-zone Finance Ministers meeting.
According to Schaebule, Greece still needs to meet more conditions before receiving their next tranche of aid.
Meanwhile, the Prime Minister has already warned that the country’s coffers will be empty if they do not receive additional funds by the end of next month and the deadline is closing in quickly.
If no progress is made, the uncertainty could mean further weakness for the euro and risk appetite.
That would boost the safe-haven USD.