With less than twenty four hours to go until the much-awaited U.S. elections, analysts have given their views on how currencies across the globe could trade amid any major volatility that the result could generate.
In a research note, Jordan Rochester, a foreign exchange strategist at Nomura, predicted that the dollar could increase further in the case of a Hillary Clinton win. "Dollar still likely to increase 1.9 percent, with GBP (sterling) and commodity currencies underperforming amid higher U.S. yields and lower equity prices."
This comes after investors across the globe have already started betting on a win for Democratic presidential candidate Hillary Clinton with the dollar edging higher on Monday morning.
In the event of a Donald Trump win, the dollar is expected to sink by around 1.3 percent, Nomura's Rochester said. He also added that dollar/yen cross could see a fall by 4.7 percent, but stated that the greenback would still rally to around 23 Mexican pesos, from its current level of 18.71.
The dollar's rise on Monday was attributed to the news that Hillary Clinton would not face any criminal charges related to her use of private email. This announcement by FBI director James Comey gave the dollar a much needed boost after its decline last week on the back of a tightening presidential race.
"The response of global markets to the news that the FBI has cleared Hilary Clinton of any wrongdoing over e-mails has been overwhelmingly positive," Paresh Davdra, CEO and co-founder of RationalFX told CNBC via email. "The U.S. dollar also strengthened as a result of the news, after a tough week which saw it weakened by the prospect of Donald Trump clinching victory during the election."
Davdra further explained that while the dollar has improved, uncertainty over the results and economic policies prevents it from further strengthening. "With some economic analysts predicting that the dollar may plunge by as much as 3 percent in the event of a Trump presidency, this election could have a great impact on global currencies. Unlike the complacency displayed in the lead up to Brexit, the markets are determined not to be caught by surprise again."
Currency analysts across the globe are busy making calls for various crosses in either scenario. Stephen Gallo, European head of FX strategy at BMO Capital Markets, made the following calls for Trump and Clinton wins " with split Congressional outcomes" – one party not controlling both houses of Congress.
While the impending presidential election could inject the dollar with extreme levels of volatility, analysts have also predicted that from a technical standpoint the dollar remains bullish as investors continue to bet on a rate hike from the U.S. Federal Reserve in December.
"From a technical standpoint, the greenback is still firmly bullish on the daily timeframe with bulls-eying the 98.00 resistance," Lukman Otunuga, research analyst at FXTM said in a note. "With the probability of a December rate hike currently standing around 70 percent, a breakout above 98.00 could open a path towards 99.00 and potentially higher."
Investors across the globe are also worried about emerging market currencies, such as the Mexican peso that has had a roller coaster ride this election.
Martin Arnold, global FX and commodity strategist at ETF securities, told CNBC via email that in the case of a Clinton win, the Mexican peso would continue to see a strong "risk-on" rally, as U.S. economic policy would not be a headwind for the Mexican economy.
"In the case of a Trump victory, (the) Mexican peso will experience a sharp fall as anti-Mexican sentiment from Trump is likely to depress investor optimism about the future of NAFTA (North American Free Trade Agreement) and the benefits that accrue to Mexico from free trade," he said.