Dollar Near Highest Level in Over Two Years Amid Strong US Data and Trump Policies
Dollar Near Highest Level in Over Two Years Amid Strong US Data and Trump Policies
The US dollar advanced near its highest level in over two years during early Tuesday trading, as traders recalibrated their bets against US interest rate cuts for 2025 following strong economic data. Meanwhile, investor concerns about the UK’s financial health kept the Sterling in focus.
With President-elect Donald Trump’s return to the White House next week, the spotlight remains on his policies. Analysts predict these policies could enhance economic growth but might also contribute to inflationary pressures. Trump’s tariff threats, combined with the Federal Reserve’s cautious approach to interest rate reductions this year, have pushed up Treasury bond yields and strengthened the dollar, putting pressure on the Euro, Sterling, Yen, and Yuan.
Prashant Newnaha,
Asia-Pacific Head of Rates Strategy at TD Securities, noted that market attention now seems to be shifting towards the possibility of gradual US tariff hikes.
The Euro was trading at 1.02545 USD, hovering near its lowest level in over two years at 1.0177 USD touched on Monday.
This dynamic situation in currency markets underscores the complex interplay between policy expectations, economic indicators, and global financial stability. As we move into 2025, these factors will continue to shape investment and trading strategies worldwide.
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