Dollar Remains near 7-Week Lows vs. Other Majors


On Thursday, the greenback struggled near seven-week lows  compared to the other major currencies, as worries over U.S. President Donald Trump’s protectionist strategies, including an executive order to build a U.S.-Mexican border wall weakened dollar.

Trump on Voting Investigation

The greenback was generally weaker in spite of U.S. shares gaining and the Dow Jones Industrial Average  closing atop the 20,000 spot for the first time The dollar index, which tracks the dollar against a basket of major currencies, previously down 0.2% at 99.839. It plunged to 99.835 on Wednesday, its lowest level since Dec. 8.

The greenback destabilized after U.S. President Donald Trump stated on Twitter that he would seek a “major investigation” into assumed voter fraud, concentrating on two states and illegal voters.

The call came in spite of Republican elected representatives in key states saying they have found no evidence of deceitful voting.

The National Association of Secretaries of State said on Tuesday,  it had confidence in the “systemic integrity of our election process” and was not aware of any evidence related to Trump’s statements.

Since Trump’s inauguration last Friday, the greenback has been under pressure and worries about the lack of  transparency on his economic policies and doubts that his protectionist trade stance could hit corporate incomes and act as a strain on growth.

Against the Majors

EUR/USD inched up 0.10% to 1.0742, not far from Tuesday’s six-week high of 1.0775.

In Asia, 4th quarter inflation in New Zealand increased 1.3% year-on-year and 0.4% quarter-on-quarter, both beyond expectations with the NZD/USD down 0.12% to 0.7284 after the data, although Japan reported the corporate services price index increased 0.4% in December as projected.

In Japan, data on Wednesday indicated that exports increased for the first time in 15 months in December.  USD/CHF inched down 0.14% to trade at 0.9994.

On Wednesday, the Australian Bureau of Statistics reported that the consumer price index increased  0.5% in the 4th quarter of 2016, disappointing prospects for an increase of 0.7%.

President  Trump wants to renegotiate the North American Free Trade Agreement (NAFTA) with Canada and Mexico.

Temporarily, USD/CAD retreated 0.49% to trade at 1.3093, the lowest since January 18. After Trump tweets  “we will build the wall” the Mexican peso is increasing. It is up by 0.4% at 21.4400 per dollar as of 8:08 a.m. ET.

In pairs, USD/JPY increased 0.04% to 113.31, while GBP/USD gained  0.08% to 1.2644. AUD/USD traded at 0.7572, down 0.04%. The pound established support as investors expected the government’s bill to activate Article 50 and start the formal procedure of exiting the EU.

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