Dollar whipsaws on Trump trade rumours
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Daily Currency Update
It was an eventful day for the dollar yesterday as rumours about President-elect Donald Trump's proposed import tariffs saw the greenback whipsaw throughout the day. An article in the Washington Post stated that Trump was planning on implementing a much more streamlined programme of tariffs targeting "critical imports" which would be applicable for all countries sending goods to the US. As the story broke the dollar was dumped with EUR/USD jumping from around 1.0330 to 1.0430 in 30 mins. The pair held these gains for around three hours until Trump woke and took to his Truth Social platform to debunk the story calling it "fake news." On the back of this the dollar reversed most of its losses before it began to lose ground again. At present EUR/USD is hovering around 1.04 with GBP/USD above 1.25 which maybe indicates that markets believe that maybe Trumps tariff plans will not be as aggressive as previously thought even if they are not as watered down as the article in the Washington Post led us to believe.Key Movers
There was little data of note yesterday to move the markets however today we see some top-tier releases from either side of the Atlantic. First up at 10am is the first estimate of Eurozone inflation which is expected to push up a touch from 2.2% to 2.4% y/y. This afternoon sees the latest ISM Services PMI and JOLTS Job Openings from the US. For the foreseeable any news from Trump (or major news networks) about his proposed tariff plan will be the main market mover and likely drown out any data.Expected Ranges
- GBP/USD: 1.2470 - 1.2605 ▲
- GBP/EUR: 1.2010 - 1.2105 ▼
- GBP/AUD: 1.9900 - 2.0065 ▲
- EUR/USD: 1.0360 - 1.0465 ▲