Donald in Davos
It’s been a week of weak dollar news and commentary, but the USD got a bit of a lift overnight as President Trump said he prefers a strong dollar.
“The dollar is going to get stronger and stronger, and ultimately I want to see a strong dollar,” Trump said during an interview with CNBC in Davos.
This is a change from Treasury Secretary Steven Mnuchin’s comment Wednesday that a weaker dollar is good for the United States. European Central Bank President then said on Thursday that there were concerns from the ECB on Mnuchin’s comment. Trump said Mnuchin’s words were taken out of context and added that he preferred not to talk about currency.
The GBP/USD pair dropped from 1.42 to 1.40 on his comments, but has since regained to 1.42 levels. EUR/USD also dropped on the President’s comments to 1.23 and has spiked back to 1.24.
Trump wrapped up his speech to the Davos crowd this morning, assuring the global attendees that “America First does not mean America alone” and that the country is open for business.
A tale of two GDPs
The GBP/USD rose to 1.42 on higher-than-expected fourth-quarter U.K. GDP numbers and lower-than-expected U.S. GDP numbers.
U.K.’s economy grew 1.5% year over year (estimated at 1.4%) and 0.5% quarter over quarter, with the dominant services sector helping those numbers most.
The U.S. slowed in the fourth quarter with GDP increasing 2.6%, compared to 3.2% in the third quarter. A surge in consumer spending also meant an increase in imports, which grew at 13.9% in the fourth quarter, ultimately subtracting from the quarter’s GDP.
EUR/USD lifted to 1.245 on the U.S. GDP miss.
USD/JPY trading flat before BoJ speech
USD/JPY pressured 110 after President Trump’s comments on the strong dollar, but it now trading flat around 109.2. Bank of Japan Governor Haruhiko Kuroda is giving a speech today and we’ll see if that impacts the pair.
– Steve Thompson, The WorldFirst Team