Dollar loses ground amid global investors’ high expectations for Trump presidency

The dollar lost ground and U.S. Treasury yields fell on Monday as market expectations for a Trump victory in the upcoming U.S. presidential election softened significantly.

The dollar fell by 0.6% against a basket of major currencies, marking its largest one-day decline since September.

Weekend poll in Iowa shows positive momentum for Harris

The depreciation follows a weekend poll in Iowa showing unexpected support for Democratic nominee Kamala Harris, in a state traditionally leaning toward Trump.

The poll, conducted by Des Moines Register and respected pollster J. Ann Selzer, has been seen as a key indicator in the race.

Analysts noted the market had priced in a “Trump premium,” driving up the dollar by an estimated 3%, but that is now beginning to unwind with Harris’ increased support.

Meanwhile, Asian currencies saw gains against the dollar on Monday. The Mexican peso also strengthened amid shifting perceptions of the U.S. election outcome.

It’s hard for anybody to say they saw this coming. She has clearly leaped into a leading position.

J. Ann Selzer, American political polster

Recent results show that both Trump and Harris are focusing almost exclusively on seven key battleground states expected to decide the election. Neither candidate has campaigned in Iowa since the primaries, and their campaigns have not established a notable presence in the state.

A Harris win in Iowa would be unexpected, given the state’s recent conservative shift, with Trump achieving decisive victories there in 2016 and 2020.

The poll reveals that women – particularly older and politically independent voters – are driving Harris’ late surge in support.

“Age and gender are the two most significant factors behind these numbers,” Selzer explained.