U.S. Dollar Extends Decline As Trump's Speech Disappoints
January 11 2017 - 10:38PM
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The U.S. dollar extended fall against its major opponents in
early European session on Thursday, after the U.S. President-elect
Donald Trump gave little details on his fiscal policies and tax
reforms, disappointing investors.
In his first press conference since the election victory, Trump
neither gave specific details on the fiscal stimulus nor tax reform
measures, disappointing investors who had hoped more clarity on
these policies.
Trump accepted that Russia was behind the hacking operation that
led to demoralizing leaks for Hillary Clinton and the
Democrats.
Trump insisted that he would build a full border wall with
Mexico, and force the Mexican government for its payment later.
The U.S. treasury yields fell, with the benchmark yield on
10-year note falling 2.3 percent, while that of 2-year equivalent
was down by 1.15 percent. Yields move inversely to bond prices.
Market participants await speeches from Chicago Fed President
Charles Evans, Atlanta Fed President Dennis Lockhart, Philadelphia
Fed President Patrick, St. Louis President James Bullard and the
Fed Chair Janet Yellen later in the day, as well as reports on
weekly jobless claims and import prices for more clues about
economic outlook.
The currency has been trading in a negative territory in the
Asian session.
The greenback dropped to near a 2-week low of 1.0643 against the
euro, compared to Wednesday's closing value of 1.0582. The next
possible support for the greenback is seen around the 1.10
mark.
The greenback declined to 114.18 against the Japanese yen, its
weakest since December 9, 2016. Continuation of the greenback-yen's
downtrend may lead it to a support around the 112.6 level.
Survey figures from the Cabinet Office showed that a measure of
peoples' assessment of the Japanese economy held steady at the end
of the year.
The current index of Economy Watchers' survey came in at 51.4 in
December, the same reading as in the previous month. In October,
the score was 48.4.
The greenback that closed Wednesday's trading at 1.2208 against
the pound weakened to 1.2264. Further weakness may take the
greenback to a support around the 1.24 region.
Data from the National Institute of Economic and Social Research
showed that the U.K. economy expanded at a steady pace in the
fourth quarter.
Output grew 0.5 percent in the fourth quarter, the same pace as
seen in three months ended November.
The greenback fell to a weekly low of 1.0088 against the Swiss
franc, compared to 1.0141 hit late New York Wednesday. The
greenback is seen finding support around the 0.99 area.
The greenback slid to a 4-week low of 0.7115 against the kiwi,
more than 4-week lows of 1.3107 against the loonie and 0.7494
against the aussie, from its early highs of 0.7046, 1.3184 and
0.7430, respectively. On the downside, the greenback may locate
support around 0.72 against the kiwi, 1.29 against the loonie and
0.76 against the aussie.
Looking ahead, Eurozone industrial production for November is
due to be released at 5:00 am ET.
At 7:30 am ET, European Central Bank's publishes monetary policy
meeting accounts.
In the New York session, Canada new housing price index for
November, U.S. import price index for December, and U.S. weekly
jobless claims for the week ended January 7 are set to be
published.
At 8:30 am ET, Federal Reserve Bank of Chicago President Charles
Evans and Federal Reserve Bank of Atlanta President Dennis Lockhart
are expected to speak about the economic outlook and monetary
policy at the American Council of Life Insurers, in Naples.
At the same time, Federal Reserve Bank of Philadelphia President
Patrick Harker will deliver a speech at the Desmond Hotel, in
Pennsylvania.
At 1:15 pm ET, Federal Reserve Bank of St. Louis President James
Bullard gives a presentation on the U.S. economy and monetary
policy before the Forecasters Club of New York.
At 1:45 pm ET, Federal Reserve Bank of Dallas President Robert
Kaplan participates in a moderated Q&A before the Dallas
Regional Chamber Annual Meeting, in Dallas, U.S.
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