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GBP/AUD spot rate at time of writing: 1.8074Bank transfer rate (indicative guide): 1.7413-1.7540FX specialist providers (indicative guide): 1.7774-1.7883More information on FX specialist rates hereThe outlook for the Australian Dollar may have been bolstered this week by the tentative outcome of the U.S. election, according to strategists at Deutsche Bank.

Australia's Dollar advanced against all major rivals barring the oil-linked Norwegian Krone as investors presumed an opposition victory in Tuesday's somewhat contested U.S. election, which was shaping up to be a bit of a poisoned chalice for the presumed winner and an end to the incumbent President Donald Trump's tenure in the White House.

Markets are expecting a more conclusive outcome ahead of the weekend as a final result in key swing states were expected, but legal challenges to the results brought by Trump's team could complicate the outlook.

Financial markets are nevertheless reflecting a view the White House would be changing hands while the Republicans can at best retain control of the Senate. That could be a gamechanger for the Aussie and a further headache for the Reserve Bank of Australia (RBA).

"What is the next focus for the market? Carry trades," says George Saravelos, a strategist at Deutsche Bank. "In FX, it is about the search for carry or any positive idiosyncratic stories that differentiate a country from the 'low growth, low inflation, stuck politics' pack. There is very, very little carry left in G10 FX but three countries that stand out with a positive growth outlook for the next few months are Australia, Sweden and Norway."

Australian bond yields offers investors from all major economies barring the U.S. something called 'carry,' which describes a yield premium or improvement that would be paid to investors who buy bonds in Australia rather than from governments in their own countries.

An influx of capital seeking to profit from Australia's superior yields in turn prompts higher AUD valuations.

Above: AUD/USD rate shown at weekly intervals with 10-year Australian government bond yield (yellow line, left axis).

Carry trading is a strategy that's popular with many kinds of institutional investor, but it's been a less reliable strategy in recent years due to global market volatility and falling yields right across the world's developed economies, Australia included.

But Saravelos and the Deutsche Bank team see the eventual election result giving way to a renewed investor focus on seeking out superior returns across the global markets, which could lead major currencies to deviate from their recent coronavirus-inspired lockstep following of stock markets.

The level of interest rates and bond yields, combined with recovery momentum within the relevant economies, will be the arbiter of currency market winners and losers in this environment, which is an advantageous one for the commodity-backed and typically higher-yielding Australian Dollar.

A large commodities trade and close geographic proximity to fast growing Asian emerging markets, combined with Australia's position as one of the smaller major economies, have has helped to make the Australian Dollar one of the highest yielders of the pack and an attractive proposition to investors. More so in the coronavirus contaminated world, where all central banks have cut rates as far as they can in order to aid their crippled economies, spreading yield thin on the ground.

"It will (unfortunately) all be about low volatility and financial repression as central banks suppress yields," Saravelos says. "Carry and growth outperformance is a good mix to have over the coming winter months: those are the currencies that will outperform."

The Australian government's 10-year bonds had until recently offered the highest yield of any equivalent G10 government debt, with U.S. government bonds the only ones paying more on Thursday. U.S. yields have picked up this week in anticipation of a Democrat-led White House which was expected to be much less frugal than a Republican administration, although it's not certain that this will be sustained. As a result, the Aussie could find itself in receipt of renewed demand, much to the chagrin of the RBA.

"The RBA’s SoMP will be keenly awaited for further detail around the RBA’s economic projections," says Tim Riddell, a London-based strategist at Westpac. "The RBA conducted its first additional QE purchases today buying AUD2bn across 6 lines of ACGB’s from 2028 to 2032. Although slightly longer than anticipated, the maturities match the deliverable bonds into AU 10yr futures. The market took the purchases well and AU moved closely with the US moves."

The RBA cut its cash rate to new record low of 0.10% Tuesday and increased as well as recalibrated the quantitative easing programme through which it uses purchases of Australian government bonds to force down yields and by implication, borrowing costs across the economy.

It pointedly noted that Aussie government bond yields were some of the highest out there among major economies and set out to change that by buying longer-term bonds like the 10-year, rather than the three-year and those at the shorter end of the so-called yield curve or maturity spectrum. Bond yields move in the opposite direction to prices.

Tuesday's expanded quantitative easing is yet to ruffle the feathers of the Australian Dollar, which has continued to track U.S. stock markets this week, but transactions under the programme will reduce bond yields over the coming months and potentially enough so to prevent or otherwise scupper an influx of yield-hungry foreign capital. This might have eventual implications for the Aussie Dollar, although much will also depend on containment of the coronavirus and the resulting pace of economic recovery from government-imposed shutdowns.

"The RBA’s Statement on Monetary Policy is released tonight and may influence AUD somewhat," says Carol Kong, a strategist at Commonwealth Bank of Australia. "According to the Australian Financial Review, a state‑controlled Chinese newspaper acknowledged that China would impose a ban on some Australian commodities including: wine, coal, barley, copper ore and concentrate, sugar, timber, wine and lobsters. While these restrictions would adversely impact the affected exporting industries, the overall impact on Australian exports appears small. We still expect Australia’s number one export to China, iron ore, to be largely unscathed."