Dollar Skids As Investors Wait For Details On Trump's Promised Stimulus
By Vamsi Krishna N : 23-Jan-2017
The Asian trade has witnessed a slide in the dollar value, in light of the investors locking in gains on the recent rise of the greenback, while they are waiting for the details from the new US President-elect Donald Trump on his proposed stimulus.
Bart Wakabayashi, head of Hong Kong FX sales at State Street Global Markets told, “The dollar is being sold off pretty aggressively, with the euro at the highs. It is across-the-board dollar selling, not just the risk on/risk off trade.”
He also said that the downfall of the dollar is because of the uncertainty surrounded in the market with the new policies announced by the Trump in his inaugural speech. He said that “It seems to be driven by uncertainty right now, and Trump’s inauguration speech has led the way there.”
KaneOgino, director at foreign exchange research firm Global-info Co in Tokyo speaking about the inaugural speech of Trump said that “Trump hasn’t said anything new and hasn’t done anything yet, so people wait and see. We have to see what kind of policies he actually follows.”
The strategists from Morgan Stanley also noted about the recent raising of the dollar followed by the current downfall that, “When Donald Trump won the U.S. presidential election, markets were thrilled at the victory and its clearing of a path to fiscal stimulus alongside transformative tax, trade, and infrastructure policies. As Trump took the oath of office, we transitioned from the thrill of victory to the difficulty of governing.”
Earlier this month, during an interview with Wall Street Journal, Trump said that currently, the US companies are not in a position to compete with the Chinese market, as the currency of US is now strong and is killing us.