Dollar Remains near 7-Week Lows vs. Other Majors

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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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Asia Shares Gain in Cautious Trade as U.S.-China Eyed

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On Tuesday, Asian shares increased with investors watchful as friction between China and the U.S. looks like on the rise following a series of tweets from U.S. president-elect Donald Trump on matters from the South China Sea to the exchange rate.

The Shanghai Composite Index edged up slightly, while Hong Kong’s Hang Seng Index increase 0.75%.

Australia’s S&P/ASX 200 increase 0.82% with strength in its materials sub-index, up 1.16%.

In Australia a narrower than perceived current account deficit was shrugged off as the Reserve Bank

of Australia held steady as anticipated at a record low 1.50% cash rate, while indicating concern over the Aussie’s strength.

In Japan, average cash gains increase 0.1, lower than the 0.2% increase seen year-on-year. Australia reported the 3rd quarter current account deficit came in at A$11.4 billion, smaller than the A$13.7 billion gap expected. The Nikkei 225 increase 0.51%.

On Tuesday, the yuan increase suddenly against the dollar after the People’s Bank of China set a much stronger fixing,  the largest percentage gain in the fixing in six months ,  following the decline in the . US dollar index overnight.

Suddenly on Monday, U.S. stocks were higher after the close, as gains in the Financials, Basic Materials and Technology sectors led shares higher.

At the close in NYSE, the Dow Jones Industrial Average increased 0.24% to hit a new all time peak, while the S&P 500 index  added 0.58%, and the NASDAQ Composite index  increased 1.01%.

On Additional News

On Tuesday, gold eased in Asia following an early round of bargain hunting as investors look further than the widely anticipated Fed rate hike this month for any new language on the pace of increases going forward.

On the Comex division of the New York Mercantile Exchange gold drop 0.07% to $1,175.65 a troy ounce. Somewhere else in metals trading, delivery of silver for March on the Comex increase 0.08% to $16.913 a troy ounce, while  delivery of copper for March drop 0.45% to $2.682 a pound.

On Tuesday, crude oil prices decline in Asia with U.S. industry inventory estimates ahead expected to establish the tone.

Later on Tuesday, the American Petroleum Institute will publish its estimates of crude oil and refined product stocks the previous week. On Wednesday, more closely-watched official figures from the U.S. Department of Energy are due.

Delivery of U.S. crude for January fell 0.98% to $51.28 a barrel on the New York Mercantile Exchange (NYMEX).

Brent crude, the global oil price benchmark traded on London’s Intercontinental Exchange, was last quoted at $54.22 a barrel.

On the other hand, investors are watchful that all 14 members of the Organization of Petroleum Exporting Countries (OPEC) will follow to the production curbs.

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