(Bloomberg) -- Gold fell on a surging dollar as Republican nominee Donald Trump was on the cusp of recapturing the White House.

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Bullion tumbled as much as 1.5%, before paring losses, after the key battleground states of Pennsylvania, North Carolina and Georgia were called for Trump. He also had leads in Wisconsin, Michigan and Arizona, with Democrat Kamala Harris not appearing to have a path to victory.

The prospect of a second Trump presidency pushed the dollar to the highest level in a year, making bullion more expensive for many buyers, and buoyed Treasury yields, weighing on gold.

Some investors have bet heavily on a Trump victory in recent weeks. Trades tied to his pro-growth agenda have boosted the dollar. However, there’s still nervousness over steep trade tariffs that he’s pledging, which could eventually aid gold.

“While a stronger US dollar and higher yields in a Trump win may be headwinds for gold, this will be balanced with potential safe-haven demand in the event of any trade tensions from potential tariffs,” said Jun Rong Yeap, a market strategist with IG Asia Pte.

Gold has surged more than 30% this year in a record-setting run that’s been powered by heightened geopolitical and economic risks, driving purchases by central banks and consumers alike. The rally has intensified in the last few months as the Fed pivoted to rate cuts and the US election loomed.

“A Republican sweep could fuel concerns about excessive government spending, pushing the debt-to-GDP ratio higher and likely bringing more hedging demand for gold,” said Charu Chanana, a strategist at Saxo Capital Markets Pte.

Spot gold fell 0.6% to $2,726.42 an ounce as of 3:56 p.m. in Singapore. The Bloomberg Dollar Spot Index climbed 1.4%. Silver, platinum and palladium all tumbled.

The election has overshadowed the Federal Reserve’s rate decision on Thursday. A 25-basis point cut has already been priced in, and is unlikely to impact bullion, Commerzbank AG said in a note by analysts including Carsten Fritsch.

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