Trump Administration Keeps the Markets Jittery

Mayhem was witnessed in the markets towards the US session as ‘loose talk’ Trump and his team continued with their spite and antics. The currency markets were most affected due to this as this time, FX and currencies were their targets. Trump and his team made statements that said that Germany, Japan and China were trying to devalue their currencies on purpose in order to be beneficial for their economy. These sorts of statements have the capability to be interpreted in different ways as it can be said that they want the USD to be devalued as well and it also means that the other currencies are now devalued but their actual values must be larger when compared to the USD.

This was enough for the markets to enter into a bout of fresh USD selling which saw the EURUSD pair rise by over 100 pips to trade above 1.0800 for a brief while before falling back just below that as of this writing. GBPUSD also bounced off from its lows at 1.24 and trades just below 1.26 as of this writing and the USDJPY crashed from close to 114 to its lows near 112. It is going to be an important few days coming up as the markets are still very jittery about the new administration in the US and it will take a few days for it to settle down and get used to this. We also have a range of data coming up in the new month over the next few days and all these are going to be noted very closely as they are likely to have an impact on future policy in the respective countries.

 
For more detailed analysis from the author, please visit NoaFX.