USD: It is still all Trump all the time - Rabobank

Sandeep Kanihama FXStreet Contributor

Michael Every, Head of FMR at Rabobank, notes that for markets, it is still all Trump all the time as yesterday saw the Dow dip slightly, the USD slump (DXY now sub 100 for the first time since mid-November), and 10-year US Treasury yields tumble further to 2.40%, all as another wave of Trumpisms hit us.

Key Quotes

“Most important, perhaps, was Treasury Secretary nominee Mnuchin stating than an “excessively strong dollar” could have a negative short-term effect on the economy. (Even MXN rallied on that news!)”

“However, let’s not forget that President Trump also officially withdrew from the Trans-Pacific Partnership (TPP) trade deal. That may not have come as a surprise, but it was the final coup-de-grace for the much maligned ‘gold standard’ of global trade deals, and the full ramifications of its demise are yet to be seen. Trump also reaffirmed that a “major” US border tax was looming. As such, it looks like many firms will soon have to decide which side of the US border their production is going to be on. Given the market response to that idea - as opposed to the postelection stock and USD euphoria - one can only presume that market participants thought Trump was not serious about his protectionist threats (whereas he was serious about deregulation and tax cuts - talk about selective hearing and ‘efficient markets’?!)”

Author

Sandeep Kanihama

FXStreet Contributor

Sandeep Kanihama is an FX Editor and Analyst with FXstreet having principally focus area on Asia and European markets with commodity, currency and equities coverage. He is stationed in the Indian capital city of Delhi.

EUR/USD trims gains, back below 1.1800

EUR/USD now loses some upside momentum, returning to the area below the 1.1800 support as the Greenback manages to regain some composure following the SCOTUS-led pullback earlier in the session.

GBP/USD off highs, recedes to the sub-1.3500 area

Following earlier highs north of 1.3500 the figure, GBP/USD now faces some renewed downside pressure, revisiting the 1.3490 zone as the US Dollar manages to regain some upside impulse in the latter part of the NA session on Friday.

Gold climbs to weekly tops, approaches $5,100/oz

Gold keeps the bid tone well in place at the end of the week, now hitting fresh weekly highs and retargeting the key $5,100 mark per troy ounce. The move higher in the yellow metal comes in response to ongoing geopolitical tensions in the Middle East and modest losses in the US Dollar.