Dollar slumps against euro, jumps against peso on potential Trump win
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Euro, Hong Kong dollar, U.S. dollar, Japanese yen, pound and Chinese 100 yuan banknotes are seen in this picture illustration, January 21, 2016. REUTERS/Jason Lee/Illustration/File Photo
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By Sam Forgione
NEW YORK (Reuters) - The U.S. dollar hit its lowest level in more than three weeks against the euro, yen, Swiss franc and sterling on Wednesday on nervousness about a potential victory for U.S. Republican presidential candidate Donald Trump next week.
Investors are rethinking long-held bets on a Nov. 8 victory for Democrat Hillary Clinton. Clinton held a 5 percentage point lead over Trump, according to a Reuters/Ipsos opinion poll released on Monday, but some other polls showed her Republican rival ahead by 1 to 2 percentage points.
The dollar index <.DXY>, which measures the greenback against a basket of six major currencies, was last down 0.3 percent at 97.403, after falling 0.6 percent to 97.178, its lowest level since Oct. 11.
The Mexican peso tumbled to a more than one-month low against the greenback, at 19.4667 pesos
Clinton is viewed as the candidate of the status quo, while there is greater uncertainty over what a Trump victory might mean for U.S. foreign policy, international trade and the domestic economy.
"There is a huge amount of unknown unknowns around Trump," said Richard Franulovich, a senior currency strategist at Westpac Banking Corp in New York.
The dollar was last down 0.2 percent against the Swiss franc
The dollar pared losses after the Federal Reserve kept interest rates unchanged in its last policy decision before the U.S. election, but signaled it could hike rates in December as the economy gathers momentum and inflation picks up.
The move in the dollar was mild, analysts said, because U.S. political uncertainty largely overshadowed the central bank's statement.
The Mexican peso suffered
"The peso weakening is a reflection of the increase in momentum from the polls favoring Trump," said Mazen Issa, senior currency strategist at TD Securities in New York.
(Reporting by Sam Forgione; Additional reporting by Patrick Graham in London; Editing by Nick Zieminski and Leslie Adler)
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