(Bloomberg) -- Hedge funds and other speculative traders are positioned for a further rally in the dollar as demand for haven assets rises in advance of the US presidential election.

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Hedge funds, asset managers and other speculators held some $17.8 billion in bullish dollar positions as of Oct. 29, according to Commodity Futures Trading Commission data compiled by Bloomberg. They added more than $8 billion worth of bullish bets in the week, after abandoning a negative outlook in mid-October.

The increase in bullish expectations for the US currency comes ahead of the closely contested race between Kamala Harris and Donald Trump. Some on Wall Street are hedging for an eventual protectionist pivot in trade policies by the US.

“A tighter election increases market uncertainty and benefits the dollar, given its safe haven characteristics,” said Aroop Chatterjee, a strategist at Wells Fargo. Resilient US economic data that takes pressure off the Federal Reserve to quickly cut interest rates has also contributed to this move, he said.

The dollar climbed on Friday, while the price to hedge against swings in the currency surged to the highest since April 2020, when the global pandemic was sending shock waves through the financial markets. A measure of one-week implied volatility on the Bloomberg Dollar Spot Index has been soaring heading into election.

“As betting markets shift odds of a Trump presidency, even if polling might not necessarily be showing the same kind of a split, traders are responding with defensive positioning — which in this case means taking long dollar,” said Helen Given, a foreign-exchange trader at Monex. That’s “at least until markets can gauge the severity of either incoming administration’s trade policies.”

On Wall Street, strategists widely agree that Trump’s vowed tariffs would, at least in the short term, support the dollar and hurt currencies such as the Chinese yuan and Mexican peso. But Trump has also argued that the world’s reserve currency is too strong. How he balances those competing ideas remain to be seen.

A Harris administration, by contrast, is seen by Wells Fargo’s Chatterjee as likely to bring less uncertainty around US policymaking — from trade and immigration to foreign policy. That could weigh on the dollar’s safe-haven appeal. A Democratic sweep of the White House and Congress would lead to higher social spending, a scenario that would also weaken the dollar, according to analysts at Convera.