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  • Risk sentiment weakens as odds of President Trump winning a second term improve
  • Dollar catches a bid, pushes USD/JPY higher by 30 pips.

Another wave of dollar buying has hit the forex markets, lifting USD/JPY to 104.90 from 104.60 in just five minutes. 

The bid tone around the safe-haven dollar seems to have strengthened in response to betting markets having President Trump as the favorite to win elections. “On Betfair exchange, Trump is now the favorite, narrowly, according to Bloomberg’s live blog. 

The odds of Trump winning the second term have improved over the past couple of hours. As such, markets are being forced to price out the prospect of an easy win for Democratic presidential candidate Joe Biden and a bigger fiscal stimulus package that is expected to come with it. 

The futures tied to the S&P 500 are now down 0.77% and the US 10-year yield is seen at 0.87%, down six basis points from the five-month high of 0.93% registered during the early Asian trading hours. The US dollar is gaining ground across the board. 

Technical levels