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Trump takes the vow of workplace at midday Eastern Time (1700 GMT), and assured a “brand new day of American strength” at a rally on Sunday.
United States President- choose Donald Trump|File Image/ AP
The buck was solid and Asia’s securities market were meticulously favorable on Monday as financiers waited on an anticipated flurry of plan news in the very first hours of Donald Trump’s 2nd presidency and looked at a price trek in Japan at the end of the week.
Trump takes the vow of workplace at midday Eastern Time (1700 GMT), and assured a “all new day of American toughness” at a rally on Sunday.
He has stoked expectations he will issue a slew of executive orders right away and, in a reminder of his unpredictability, launched a digital token on Friday, which soared to trade above $70 at one point for a total market value north of $15 billion.
Monday is a U.S. holiday, so the first responses to his inauguration in traditional financial markets may be felt in foreign exchange, where traders are focused on Trump’s tariff policies, and then in Asian trade on Tuesday.
U.S. equity futures were a fraction weaker in the Asian morning on Monday while the dollar, which has rallied since September on strong U.S. data and as Trump’s ultimately successful political campaign gained momentum, held steady.
Japan’s Nikkei rose 1%. [.T]
Last week the S&P 500 notched the biggest weekly percentage gain since early November and the Nasdaq its largest since early December on some benign inflation data.
The dollar is up nearly 14% on the euro since September and at $1.0273 is not far from last week’s two-year high. But so much is priced in that some analysts feel a more gradual start to U.S. tariff hikes may draw out some sellers.
“A forceful start to Trump’s new term could rattle nerves and give the dollar more support,” stated Corpay money planner Peter Dragicevich.
“By comparison, based upon what currently looks baked in, we believe an even more determined technique might reduce concerns and see the buck shed ground, as it did after Trump took fee in 2017.”
Trump has threatened tariffs of as much as 10% on global imports and 60% on Chinese goods, plus a 25% import surcharge on Canadian and Mexican products, duties that trade experts say would upend trade flows, raise costs and draw retaliation.
The Canadian dollar touched a five-year low of C$1.4486 per dollar on Monday. The Mexican peso hit a 2-1/2 year low of 20.94 per dollar on Friday. [FRX/]
Bitcoin dipped in the early part of the Asian day but remained above $100,000. Benchmark 10-year Treasury yields closed out Friday at 4.61%, up nearly 100 basis points in four months. [US/]
CHINA FOCUS
China is in focus as the target of the harshest potential trade levies. Investors lately cheered better-than-expected Chinese growth data and a Friday phone call between Trump and Chinese President Xi Jinping that left both upbeat.
“Basically everyone is waiting for these trade negotiations to begin and see what kind of attitude Xi Jinping takes with Trump,” Ken Peng, head of Asia financial investment method at Citi Wealth informed press reporters in Singapore at an overview instruction.
“That partnership in between both gents has actually ended up being extremely crucial as a leading sign of plans.”
Chinese equity markets rose last week and futures pointed to modest gains for Hong Kong shares at the open.
The yuan is seen likely to slowly adjust to any shifts in trade policy and was marginally firmer at 7.3355 per dollar in offshore trade.
The Australian dollar, sensitive to trade flows and China’s economy, has scraped off five-year lows and, according to Commonwealth Bank strategist Joe Capurso, could test resistance at $0.6322 if Trump’s policy changes fall short of market expectations. It was last at $0.62.
Japan’s yen rallied last week as remarks from Bank of Japan policymakers were taken as hints that a rate cut is likely on Friday.
It was last steady at 156.17 per dollar and rates markets priced about an 80% chance of a 25 basis point rate hike.
In commodities gold hovered at $2,694 an ounce and Brent crude futures ticked higher to $81.21 a barrel.
(This story has not been edited by News18 staff and is published from a syndicated news agency feed – Reuters)
