Dollar Holds Gains on U.S. Election Caution

The U.S. dollar held steady on Monday as investors readied for this weeks U.S. presidential election, while a surge in global coronavirus cases continued to weigh on sentiment.

The greenback held onto its gains after posting its largest weekly percentage rise since late September in the previous trading session.

Investors are sticking to the safe-harbour currency as Tuesdays presidential election keeps financial markets on edge.

“Currency volatility can extend well beyond Election Day because there is a high risk the losing candidate will dispute the election results. The 2000 election took around one month to resolve the disputes,” analysts at Commonwealth Bank of Australia said in a client note.

The dollar index, which tracks the greenback against a basket of major currencies, last sat at 94.058, near its four-week high.