(Bloomberg) -- The dollar’s rally this month is largely being driven by betting markets increasingly pointing to a victory for Donald Trump in the US presidential election, according to Standard Chartered Plc.

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The bank calculates 60% of the US currency’s gains in October are linked to growing wagers the former president will win the Nov. 5 vote.

The Bloomberg Dollar Spot Index has rallied nearly 3% and is poised for its best month since 2022. Many analysts say a Trump presidency would boost the dollar given the prospect of high tariffs and accompanying market volatility, which tends to favor haven assets.

“The dollar has strengthened along with the rising probability of a Trump win in betting markets,” Steven Englander, head of global G-10 FX research at Standard Chartered, wrote in a note. That “has affected FX more than fixed income.”

There’s been rising speculation in betting markets that Trump will win the election, with the Polymarket platform attributing a 60% probability to such an outcome and PredictIt putting it at 57%. Recent polls still show the candidates statistically tied.

Englander estimates markets are pricing close to a 70% probability of a Trump win and sees room for profit-taking if that is confirmed and the Congress is split. If Republicans win both the House and the Senate, that could have an impact on markets, he added.

But the outcome that would move markets the most would be a victory for Vice President Kamala Harris with a split Congress, Englander says. That’s because she would have a hard time getting her proposals passed, and the Federal Reserve could be forced to provide more stimulus to the economy, leading to an unwind of long dollar positions.

While the election race has been the main driver for the dollar, Trump bets only explain about seven basis points of the 40-basis-point increase in 10-year US yields since early October, Englander said. Bonds have mostly moved on the outlook for the Fed’s policy, with the surprisingly strong US jobs report from earlier this month being the main factor, he added.

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