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15/07/24
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USD Lower Before Powell Comments
On Monday, the dollar dropped from earlier highs before comments by Federal Reserve Chair Jerome Powell.
In the aftermath of an assassination attempt on former President Donald Trump, his re-election chances were boosted, and investors narrowed the odds of a Trump victory.
The dollar normally strengthens as part of what is called the “Trump trade” of assets that will likely perform well under a Trump presidency of looser regulation for certain industries and a hawkish trade policy.
Although Trump has said he supported cryptocurrency, he has not provided details on his proposed crypto policy.
The initial reaction was however short-lived, and the dollar fell from its earlier highs.
Silver Gold Bull’s director of FX & precious metals risk management, Erik Bregar, said as the initial reaction calmed down, bonds opened lower, U.S. yields higher, and the dollar higher.
Markets were trying to not overreact to what happened and consolidated in early trade in New York. Next on the docket today was Powell’s discussion with the Economic Club of Washington.
The U.S. dollar index, which measures its strength against 6 other major currencies, dropped 0.23% to 104.05 after gaining to as high as 104.31, while the euro was 0.09% higher at $1.0917. Sterling dropped 0.02% to $1.2989.
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