On Monday, the U.S. dollar strengthened slightly, maintaining its recent momentum as the presidential election approaches and polls suggest a greater chance of former President Donald Trump winning.
At 04:30 ET (08:30 GMT), the Dollar Index, which measures the dollar against a basket of six other currencies, rose by 0.2% to 103.462, following a gain of approximately 0.6% last week.
Dollar rises on growing confidence in Trump.
The dollar stayed close to its highest levels in over two months, supported by rising confidence that U.S. interest rates will decline more gradually than previously anticipated, particularly as recent data indicated that the U.S. economy remains relatively strong.
The greenback has gained further support from heightened expectations that Donald Trump will defeat Kamala Harris in the upcoming 2024 presidential election, now less than two weeks away.
Trump’s proposed tariff and tax policies are expected to maintain high U.S. interest rates and weaken the currencies of trading partners.
“FX markets appear to be positioning themselves for a Trump win in next month’s U.S. presidential election. October has been favorable for Trump in opinion polls, and the dollar is seeing strong demand across the board,” noted analysts at ING.
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