The USD has continued to retreat faster than we had expected this year and has more than reversed it gains against most countries since the more hawkish than expected FOMC meeting on 14 December notes Greg Gibbs, Director at Amplifying Global FX Capital.
Key Quotes
“It is evident that some of the euphoria for US economic growth that followed the election of Trump on 8 November has dissipated. This may reflect shifting perceptions on the priorities of Trump and the ongoing combative style his presidency promises. Media coverage of Trump in the USA has focused more on his Twitter responses to various distractions unrelated to economic policy. Corporate tax reform and infrastructure spending appear to have taken a back seat to repealing and replacing Obamacare, micro-commentary on specific companies, border tax, and building a wall on the Mexican border.”
“It is beginning to look like the Trump agenda will be bogged down in issues that do little to support growth and economic confidence. This may be dampening the US stock market performance, weighing on yields and the USD.”
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