Dollar on track for weekly gain after Trump election win
US currency may consolidate on uncertainty over Trump policies
Japanese yen suffers from widening interest rate differential
Updated at 14:40 EST
By Karen Brettell and Stefano Rebaudo
Nov 8 (Reuters) -The dollar rose on Friday and was heading for a weekly gain as investors evaluated the likely impact on the American economy of Tuesday’s election of Republican Donald Trump as U.S. president.
Analysts expect Trump's policy proposals -- including more trade tariffs, a clampdown on illegal immigration, lower taxes and business deregulation -- willboost growth and inflation.
But in the near term there remains considerable uncertainty over what policies will actually be introduced.
“We don't really know how much was campaign rhetoric, how much is a negotiating position, how much of it is speaking principle,” said Marc Chandler, chief market strategist at Bannockburn Global Forex in New York. “Part of the volatility we're seeing in the dollar and in interest rates is that the market is trying to figure it out.”
Republicans also won control of the Senate and are leading the race for the House of Representatives, with some races stillto be called.
The dollar index =USD jumped to a four-month high of 105.44 on Wednesday, but has dipped since, partly due to profit-taking. It was up 0.58% on the day at 105.01on Friday and on pace for a 0.68%weekly increase.
Data on Friday showed that U.S. consumer sentiment rose to aseven-month high in early November, in a survey taken before the election.
The next major U.S. economic release will be Wednesday's consumer price data for October.
"We need more clarity about U.S. policies," said Athanasios Vamvakidis, global head of forex strategy at Bank of America. "Until then, the greenback will be trading (on) data and expectations for the Fed easing path."
On Thursday, the Federal Reserve cut rates by 25 basis points, which had been widely expected. Chair Jerome Powell said the U.S. central bank would not speculate on the impact of any policies by the incoming U.S. government.
Traders are pricing in 65% odds that the Fed will cut again by 25 basis points in December, down from 83% a week ago, according to the CME Group’s FedWatch Tool.
The euro EUR= dropped 0.85% to $1.0712and was headed for a 1.12%decline for the week, which saw the collapse of Germany's coalition government on Wednesday.
Against the Japanese currency, the greenback fell 0.13% to 152.73yen JPY=.
The yen is expected to suffer as the interest rate differential with the United States widens, which could prompt Japan's central bank to raise rates as soon as December to prevent the currency from sliding back toward three-decade lows.
China's yuan weakened after Beijing unveiled a 10 trillion yuan ($1.4 trillion) debt package on Friday to ease local government financing strains and stabilize flagging economic growth.
"Markets may have been hoping for a larger-than-expected stimulus," said Lynn Song, chief economist for Greater China at ING.
The offshore yuan CNH= was last down 0.69% at 7.2 per dollar.
The Australian dollar AUD=, often used as a liquid proxy for its Chinese counterpart, fell 1.53% to $0.6576.
Bitcoin BTC= was last up 1.45% at $77,068, after earlier reachinga record $77,303.97.
Trump is expected to enact a more favorable regulatory environment for the crypto industry.
US inflation and interest rates https://reut.rs/40IBGZH
Reporting by Karen Brettell and Stefano Rebaudo; editing by Jonathan Oatis and Leslie Adler
Actifs liés
Dernières actualités
Avertissement : Les entités de XM Group proposent à notre plateforme de trading en ligne un service d'exécution uniquement, autorisant une personne à consulter et/ou à utiliser le contenu disponible sur ou via le site internet, qui n'a pas pour but de modifier ou d'élargir cette situation. De tels accès et utilisation sont toujours soumis aux : (i) Conditions générales ; (ii) Avertissements sur les risques et (iii) Avertissement complet. Un tel contenu n'est par conséquent fourni que pour information générale. En particulier, sachez que les contenus de notre plateforme de trading en ligne ne sont ni une sollicitation ni une offre de participation à toute transaction sur les marchés financiers. Le trading sur les marchés financiers implique un niveau significatif de risques pour votre capital.
Tout le matériel publié dans notre Centre de trading en ligne est destiné à des fins de formation / d'information uniquement et ne contient pas – et ne doit pas être considéré comme contenant – des conseils et recommandations en matière de finance, de fiscalité des investissements ou de trading, ou un enregistrement de nos prix de trading ou une offre, une sollicitation, une transaction à propos de tout instrument financier ou bien des promotions financières non sollicitées à votre égard.
Tout contenu tiers, de même que le contenu préparé par XM, tels que les opinions, actualités, études, analyses, prix, autres informations ou liens vers des sites tiers contenus sur ce site internet sont fournis "tels quels", comme commentaires généraux sur le marché et ne constituent pas des conseils en investissement. Dans la mesure où tout contenu est considéré comme de la recherche en investissement, vous devez noter et accepter que le contenu n'a pas été conçu ni préparé conformément aux exigences légales visant à promouvoir l'indépendance de la recherche en investissement et, en tant que tel, il serait considéré comme une communication marketing selon les lois et réglementations applicables. Veuillez vous assurer que vous avez lu et compris notre Avis sur la recherche en investissement non indépendante et notre avertissement sur les risques concernant les informations susdites, qui peuvent consultés ici.
