NEW YORK: The US dollar extended its recent advance against major peers on Thursday, trading at a one-year high and headed for a fifth straight session of gains, propelled by market expectations since Donald Trump clinched a dramatic return to the White House.
The greenback climbed above 156 yen for the first time since July, while the euro slumped to its weakest since November 2023 and was flat at $1.0566. Sterling hit its lowest on the dollar in four months and was last at $1.2697.
Markets anticipate that the incoming Trump administration will impose trade tariffs and tighten immigration as well as deepen the deficit, measures deemed to be inflationary. The President-elect’s Republican Party will control both houses of Congress when he takes office in January, Edison Research projected on Wednesday, giving him wide powers to push his agenda.
“The price action that we’ve had is expected given the election outcome and the logic behind it is built on expectations rather than actualities: expectations of fiscal stimulus, tariffs and deregulation,” said Daragh Maher, head of FX strategy, Americas at HSBC in New York.
“We’ve been in the dollar bullish camp so this seats neatly with our narrative but clearly there’s been a big repricing.” US producer prices picked up in October, the Labor Department reported on Thursday, a day after data showed that consumer inflation had barely budged last month. The data did not change views the Federal Reserve would deliver a third interest rate cut next month.
The US dollar index, which measures the currency against six top counterparts including the euro and yen, was up 0.11% at 106.58, after having reached as high as 107.07, its highest since early November 2023.
Bitcoin pulled back from a record high of $93,480 overnight and was last up 0.42% to $89,008. Trump has vowed to make the United States “the crypto capital of the planet.” Ethereum declined 2.23% to $3,084.30.
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