Mexico’s peso hit a one-month high on Monday, reflecting its role as a barometer of both Donald Trump’s status as a presidential candidate and overall investor anxiety.
The currency fell last month when polls indicated that the Republican candidate—who advocates deporting millions of undocumented immigrants and renegotiating the North American Free Trade Agreement—rose in the polls compared to Democratic nominee Hillary Clinton.
“The market reaction has this takeaway that Trump’s campaign is struggling,” said John Hardy, Saxo Bank’s head of foreign-exchange strategy, in a Bloomberg Television interview.
“The market has seized upon this as trading the Mexican peso as some kind of financial market proxy for the political outcome of the election,” Hardy explained.
The peso rose over 2% Monday to nearly 18.9 per dollar, pushing up the country’s major stock index, too.
Overall, the peso-dollar exchange rate has ticked up close to 5% since the first presidential debate took place on Sept. 26, when some polls showed strengthening support for Clinton.
The peso is also being supported by the rally in oil prices, after having lost more than 30% of its value in the past two years.
To help support the currency and prevent inflation, the Bank of Mexico has raised interest rates 1.5 percentage points in 2016.