020 7898 0500The US dollar is trundling along after a week of slightly disappointing data. Ultimately, the economy is losing rather than gaining momentum across the first quarter of Trump’s presidency.
The prospect of gradual rate hikes from the Federal Reserve should support the dollar from significant falls, but for now it appears the initial rally behind Trump is fizzling out.
The worries about the Trump administration’s ability to pass tax and fiscal stimulus legislation continues to rise as traders squared off position for the weekend.
The dollar index, which tracks the US currency against a basket of six major rivals, was up 0.18% at 99.954, so even if the US doesn’t get the benefits of the Trump administration’s promises around tax and infrastructure spending, the fact the Fed is hiking rates and the balance sheet is reduced (albeit with a US economy just trundling along), should see the dollar remain strong over the short and medium term.
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