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Cryptocurrency Market Update: Bitcoin Surges as Dollar Strengthens Ahead of U.S. Election
Bitcoin Hits Three-Month High Amid Dollar Gains
In early Asia trading on Monday, cryptocurrency bitcoin reached a three-month high, while the dollar showed signs of strengthening as the U.S. presidential election draws near.
Dollar Outlook Tied to Election Polls
Recent election polls suggest a growing likelihood of former President Donald Trump winning the November 5 election, which has bolstered the dollar. Trump’s proposed tariff and tax policies are anticipated to maintain high U.S. interest rates and potentially weaken currencies of trading partners.
Currency Market Movements
Market movements in major currencies last week were influenced by the European Central Bank’s rate cut and positive U.S. economic data. The yen was slightly weaker against the dollar, while the dollar index, which measures the currency against major peers, showed slight gains.
Market Focus on Corporate Earnings and U.S. Election Risk
With no significant economic events scheduled this week, market attention will likely turn to corporate earnings reports and the impending U.S. election. Analysts anticipate a rise in costs associated with hedging against dollar and portfolio risks.
Bitcoin’s Rise Amid Election Prospects
Bitcoin has benefited from improved prospects for Trump’s reelection, as his administration is perceived to have a more favorable stance on cryptocurrency regulation. The digital currency has seen an 18% increase since October 10.
Analysts’ Perspectives on Dollar Strength
Market experts highlight that rising real interest rates have been supporting the dollar, particularly against the euro, Swiss franc, and Mexican peso. They expect this trend to persist leading up to and following the election.
Currency Performance Overview
Last week, the yen, euro, sterling, and the dollar index showed varied movements, with the Mexican peso experiencing a notable decline. The euro, in particular, has seen a significant drop in value in recent weeks.