The US trade deficit jumped almost 10% in January to $48.5 billion, the largest rise since March 2012. This halted the recent dollar (USD) rally from gathering further steam. The increase in the deficit is likely to add pressure to Donald Trump’s presidency, as his current strategies could see the imbalance increase further.
The dollar remains marginally stronger as the market awaits the non-farm employment report on Friday, which is the big monthly data release from the US. The non-farm figures also happens to be the last major economic data release prior to the Federal Reserve’s meeting next week. A good number will add further strength to the dollar, as the likelihood of an interest rate hike gathers additional momentum.
For more on currencies and currency risk management strategies, please get in touch with your Smart Currency Business trader on 020 7898 0500 or your Private Client trader on 020 7898 0541.