Market Wire, North America

The Federal Reserve left rates unchanged this afternoon, and subtly upgraded its assessment of labour markets and growth, disappointing those expecting a more dovish bias and lending the dollar some much-needed support. In the widely-expected decision, the Federal Open Market Committee voted by a consensus-driven 10-to-2 margin to maintain the target range for the federal funds rate between 3.50 and 3.75 percent. Trump appointee Stephen Miran again dissented from the majority in favour of a bigger move, joined by Christopher Waller, who is seen as a potential candidate for Chair when Jerome Powell’s term ends. In a tweak to the...

The dollar is tumbling through technical barriers across most major currency pairs after US president Donald Trump told reporters “I could have it go up or down like a yo-yo,” and that he’s not concerned about its recent decline, saying “Look at the business we’re doing. The dollar’s doing great”. “If you look at China and Japan, I used to fight like hell with them, because they always wanted to devalue,” he said, but “it’s hard to compete when they devalue”. The president’s comments suggest that recent (rumoured) moves to support Japanese currency intervention—intended to raise the value of the...

Markets are celebrating TACO Tuesday on a Wednesday after US President Donald Trump dropped a threat to impose tariffs on imports from a number of European trading partners, saying that he and NATO Secretary-General Mark Rutte had “framework of a future deal with respect to Greenland and, in fact, the entire Arctic Region”. The dollar is climbing against its peers, while the Swiss franc falls amid a broader surge in risk appetite. Equity markets are rallying and US yields are edging lower. In a post on his social media platform, the president said: “Based upon a very productive meeting that...

The Trump administration sharply intensified its assault on the Federal Reserve’s independence this evening, threatening a fundamental cornerstone of the international monetary and financial system—and a key factor underpinning the dollar’s global dominance. According to multiple news sources and officials themselves, US prosecutors today served the central bank with grand jury subpoenas and a threat of criminal indictment over Chair Jerome Powell’s testimony before the Senate Banking Committee last June—in which he defended cost overruns on a long-standing headquarters renovation projection. In a video statement released on the bank’s website, Powell dismissed the scrutiny as a politically-motivated attempt to undermine...