Global investors are bracing for a week of volatile trading in financial markets before one of the most closely fought US elections in history.
As voters in the world’s largest economy prepare to head to the polls on Tuesday, the dollar and the yield on US Treasury bonds fell on Monday as investors pared bets on a Donald Trump victory.
The greenback dipped 0.6% against a trade-weighted basket of currencies, dropping to its lowest level in two weeks after a surprise opinion poll showed Kamala Harris ahead in Iowa, which had previously been expected to be a safe state for the Republicans.
The yield – in effect the interest rate – on 10-year US Treasury bonds fell by about nine basis points to 4.28%.
Trump has been ahead in betting markets, despite trailing in opinion polls, leading to what Wall Street has called the “Trump trade” – a bet that his policies could lead to a boost for share prices, Treasury yields and the dollar.
