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USD: Federal Reserve in the spotlight following Trump win

By Michael Cooper November 14th, 2016

The US dollar was for set for its best week in a year on Friday while the US was on public holiday for Veterans Day. Expectations of rising US price pressures if Trump delivers on promises to boost public spending and lower taxes and place barriers on cheap imports have driven Treasury yields higher and boosted the dollar since his victory. The gains have come across the board with the exception of sterling. However, there are doubts whether these gains will continue into this week.

This week will see Federal Reserve member Jeffrey M. Lacker speak on Monday evening. The market will be listening eagerly to every word to interpret the Federal Reserve’s response to Donald Trump becoming the upcoming President of the US. Any news of the interest rate hike that was priced in when Clinton was expected to win the race to the Oval Office will also be of interest. Later in the week we have inflation data due on Wednesday and Thursday, which will provide the markets with further direction regarding the central bank’s thoughts for its December meeting.

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