The US dollar rose in early Monday trading, with the dollar index—measuring its performance against a basket of major currencies—nearing the multi-month highs reached last Wednesday. Despite the Fed’s recent 25-basis-point rate cut, the greenback is benefiting from market speculation that incoming US policies could spark inflationary pressures, potentially altering the Fed’s future rate trajectory. President-elect Donald Trump has announced plans for a protectionist trade agenda, including significant import tariffs. If implemented, these measures could drive consumer prices higher, potentially limiting the Fed’s options for future rate cuts. Against this backdrop, financial markets are responding by offloading treasuries, pushing higher yields. This shift also creates greater demand for the dollar as investors seek yield advantage, further strengthening the greenback’s position. As a result, the dollar has been gaining momentum across major currency pairs, supported by expectations that US interest rates may remain elevated for a more extended period.
Ricardo Evangelista – Senior Analyst, ActivTrades
Source: ActivTrader
The information provided does not constitute investment research. The material has not been prepared in accordance with the legal requirements designed to promote the independence of investment research and as such is to be considered to be a marketing communication.
All information has been prepared by ActivTrades (“AT”). The information does not contain a record of AT’s prices, or an offer of or solicitation for a transaction in any financial instrument. No representation or warranty is given as to the accuracy or completeness of this information.
Any material provided does not have regard to the specific investment objective and financial situation of any person who may receive it. Past performance is not a reliable indicator of future performance. AT provides an execution-only service. Consequently, any person acting on the information provided does