Investment guru Mark Mobius predicts that the dollar will strengthen if President Donald Trump wins a second term.

“If Trump wins, then you will probably see a stronger dollar coming in. I would say the dollar weakness is really a vote of confidence on the U.S. … and particularly on the success of Trump,” he told the Economic Times of India.

“The dollar index has really come down quite a lot and it is down to the level of its lowest trend within the last 20 years I would say,” said the founder of Mobius Capital Partners.

“We are probably nearing the end of this downturn but that does not mean it is going to go up. We should probably continue to see dollar weakness and a lot of this depends on what happens with the U.S. election.”

However, not everyone is as optimistic about the American currency.

For his part, Ulf Lindahl, the chief investment officer of currency manager A.G. Bisset believes the U.S. currency will plunge 36% against the euro over the next year or so, taking it to levels it has not seen in more than a decade.

The greenback's recent weakness "is the beginning of a very large move" that could hurt the droves of investors exposed to it through their holdings in U.S. stocks and bonds, Lindahl told Reuters.

Wall Street is swarming with bearish dollar forecasts, though few are as extreme as Lindahl's. The U.S. currency is near its lowest level in 27 months and is down about 11% from its 2020 peak against a basket of its peers, with Goldman Sachs, UBS and Societe Generale among the banks forecasting more losses.

Getting the dollar right is key for investors, as its trajectory sways everything from corporate earnings to the prices of raw materials such as oil and gold.

Regardless of who wins the Nov. 3 election, some market watchers say, markets are likely to grow more turbulent, Reuters explained.

Economic uncertainty resulting from the coronavirus pandemic still looms large, and the possibility of a delayed vote count due to a large number of mail-in ballots has also unsettled some investors. Moreover, a buildup of positions in big tech-related stocks has increased risk, as seen in a sharp market sell-off on Thursday.

"This is just a situation where all the conditions are ripe for an extraordinary profit" from volatility, said James McDonald, chief executive of Los Angeles-based hedge fund Hercules Investments.

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