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Kamala Harris’s rising election prospects in recent days have weakened the Trump trade.
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A poll last weekend showed Harris leading Trump in Iowa, swinging the betting markets her way.
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Yields on government bonds, the US dollar, the Mexican peso, bitcoin and Trump Media shares are shifting.
A surprise shift in a key presidential poll last weekend has tilted bets toward Kamala Harris, hitting a host of “Trump trades” that have surged in recent weeks.
A poll released this weekend showed Harris leading former President Donald Trump in Iowa 47% to 44%. The poll, conducted by The Des Moines Register/Mediacom and conducted by pollster J. Ann Selzer, is significant because Iowa has long been considered a state Trump would win.
“It’s hard for anyone to say they saw this coming,” Selzer told The Des Moines Register. “She has clearly established a leadership position.”
The poll sent shockwaves through betting markets this weekend, with Kalshi showing Harris’ odds briefly overtaking Trump for the first time since early October, 51% to 49%.
As of Monday at 11:35 a.m. ET, the odds on the betting site were 55% for Trump and 45% for Harris. On Polymarket, where Trump’s odds were over 60% last week, they have fallen to 58.1%, while Harris’ odds were at 42.8%.
The large swing in betting caused waves that can be felt on the financial markets on the eve of the elections.
Here’s where things stand for five parts of the Trump trade.
Ten-year U.S. Treasury yields fell 12 basis points on Monday, falling to 4.275% after last weekend’s poll surprise.
The rise in Treasury yields since the Fed cut rates in September reflected the market’s belief that a second Trump presidency seemed likely and that this would be an inflationary event due to his promises to impose sweeping tariffs and mass deportations, which would lead to higher interest rates. prices and wage growth respectively.
Investors have priced in higher rates in recent weeks as they believe Trump’s policies would make it difficult for the Fed to cut rates even further.
The dollar soared in October as chances of a Trump presidency increased, with markets predicting potential tariffs and higher interest rates would boost the currency against rivals.
The US dollar index, which measures the greenback’s strength against a basket of other major currencies, rose about 4% in October.
However, that trade fell on Monday due to Harris’ rising betting odds, with the US dollar index down almost 1% to 103.55.
