Dollar struggles in Asia, China data underwhelm

There was muted reaction to end-of-the-year data from China showing the world's number-two economy was still struggling on the trade front, with uncertainty over Trump's upcoming presidency.

Dollar struggles in Asia, China data underwhelm

World Bulletin / News Desk

The dollar struggled to break back after its recent sell-off as investors fret over Donald Trump's lack of specifics on economic policy.

After a global rally fuelled by hopes his election victory would see a boost to the US economy, trading floors are turning more quiet with talk that the surge may have been overdone.

Among the main losers in the recent pull-back is the dollar, which soared on expectations the real estate tycoon's plans for big spending and tax cuts would fan inflation and force the Federal Reserve to lift interest rates.

The dollar just last week was hovering around 118.60 yen but on Thursday dropped below 114 yen after markets were left with scan detail on the president-elect's plans for boosting US growth.

The greenback has recovered slightly but remains under pressure while it was also down against the euro and pound. 

"This is really a pause that we were looking to get even a month ago," Philip Guarco, global head of fixed-income strategy at JPMorgan Private Bank in New York, told Bloomberg TV.

"Rates had moved too far, too fast so we had this sort of reflation exuberance. I think we consolidate here and just wait to see what's going to happen in terms of execution."

However Stephen Innes, senior trader at OANDA, said he expected "the market to reload (dollar) long positions ahead Trump's inauguration and State of the Union (next Friday) where once again traders will brace for confirmation on the fiscal spend."

Güncelleme Tarihi: 13 Ocak 2017, 10:23
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