U.S. Dollar Climbs On Trump Optimism
2024-11-01
3471
(fxcue news) - The U.S. dollar strengthened against its major counterparts in the New York session on Friday on hopes that policies under incoming President Donald Trump would spur economic growth and inflation.
Trump has proposed tax cuts and tariffs on imported goods in his election campaign.
Trump's fiscal policies will elevate upside risks to inflation and push rates higher.
The Fed cut the interest rate by 25 basis points as expected on Thursday, and Chair Jerome Powell stressed that rates are not on "any preset course" and that the central bank will make future decisions "meeting by meeting" to deal with the risks to both sides of the dual mandate.
However, market participants lowered expectations for further interest rate reductions for 2025 following the victory of Trump.
The greenback advanced to 1.0718 against the euro and 1.2911 against the pound, off its early lows of 1.0804 and 1.2988, respectively. The next possible resistance for the currency is seen around 1.06 against the euro and 1.26 against the pound.
The greenback recovered to 0.8752 against the franc and 152.85 against the yen, from its early 2-day lows of 0.8701 and 152.13, respectively. The currency is poised to challenge resistance around 0.89 against the franc and 156.00 against the yen.
The greenback edged up to 0.6576 against the aussie, 0.5963 against the kiwi and 1.3920 against the loonie, reversing from its early lows of 0.6680, 0.6027 and 1.3859, respectively. The currency is likely to locate resistance around 0.64 against the aussie, 0.58 against the kiwi and 1.40 against the loonie.
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