NEW YORK: The dollar rose against the safe-haven Japanese yen and Swiss franc on Tuesday while the Mexican peso and Canadian dollar also gained as investors upped their bets on victory for Hillary Clinton in the US presidential election.
Market sources cited projections from data firm VoteCastr favoring Clinton in a number of key battleground states, which could put the former secretary of state over the top in the election, as moving the cluster of currencies.
A victory for Republican Donald Trump would be expected to drive capital into the perceived security of the Japanese yen and Swiss franc and be negative for the economies of Canada and Mexico.
Trump has pledged to renegotiate the North American Free Trade Agreement the US has with both countries.
"Around 11:15 a.m. the whole pro-Clinton trade in FX started to move in concert - Mexican peso, Canadian dollar, Japanese yen all went to session highs or session lows - and that's mainly because Votecastr released projections that Florida was trending (Clinton's) way, which is really the only thing that matters," said Boris Schlossberg, managing director of FX strategy at BK Asset Management.
"Even though Votecastr is projecting Pennsylvania going early to (Trump) it wouldn't matter. Florida has always been the main pivot in this election and the fact that she's trending strongly so far is really what it all comes down to."
The dollar rose to 105.19 yen, its highest against the yen since Oct. 31. It gained 0.2 percent versus the Swiss franc. The Canadian dollar added 0.2 percent against its US counterpart and the Mexican peso rose more than 1 percent against the greenback, touching its highest since Sept. 8. The euro fell against the dollar, retracing earlier gains, and was last down 0.15 percent to $1.1019, its lowest in a week.
The gains against the euro and yen helped push the dollar index, which measures the greenback against six major world currencies, to its highest level in a week. Clinton has a 90 percent chance of defeating Trump, according to the final Reuters/Ipsos States of the Nation poll released on Monday.
Clinton was on track to win 303 votes in the Electoral College to Trump's 235, clearing the 270 needed for victory. She also leads Trump by about 44 percent to 39 percent, according to the poll.
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