DOLLAR DOOM: Trump’s Attacks Send Currency CRASHING to 3-Year LOW!
In a stunning financial earthquake, the dollar took a nosedive on Monday, plummeting 1.1% to a terrifying low against a basket of its rivals! This jaw-dropping decline comes as President Donald Trump went to WAR with Federal Reserve chair Jay Powell, unleashing a storm of uncertainty in US economic policy.
But that’s not all! As the dollar fell from grace, GOLD skyrocketed an astonishing 2% to an eye-popping record of $3,393 per troy ounce! Investors are scrambling for safety, and it’s clear the precious metal is the golden ticket. Meanwhile, the Swiss franc surged to a jaw-dropping 10-year high, now standing strong at SFr0.8069 against the dollar. The euro and the yen jumped too, with the euro up 1.1% to $1.15 and the yen rising 1% to ¥140.7. The currency war has just begun!
It all started when Kevin Hassett, the director of the National Economic Council, dropped BOMBSHELL comments that Trump might just “continue to study” the idea of firing Powell. Can you believe it? Trump himself claimed he has the power to ax the Fed chair, and the market is REELING from the implications!
Hassett faced the press and said if anyone thinks Trump is being unreasonable with his frustration towards the Fed’s policies, then they’ve got some serious explaining to do! Talk about throwing gasoline on the fire!
And as if that wasn’t enough, US sovereign debt is selling like hotcakes! Yields on 10-year US Treasuries shot up to 4.36%, and 30-year yields spiked to 4.87%. What does this mean? Investors are freaking out!
Parisha Saimbi, a foreign exchange guru from BNP Paribas, stated the situation is spiraling into chaos, with global investors likely rethinking their entire portfolios! The euro and yen are benefitting from what many believe is a massive repatriation of assets.
Yujiro Goto, an FX strategist at Nomura Securities, is waving a RED FLAG, pointing out that seeing a bond sell-off alongside currency depreciation in the grand ol’ US of A is nothing short of shocking! He warns of looming stagflation and an alarming distrust in US asset credibility.
In another ominous sign, analysts from CICC, a leading Chinese investment bank, revealed that this domestic policy uncertainty is turning the dollar and Treasuries into what they call “risk assets”! Trump’s comments are further stoking fears over the independence of the Fed.
Asian markets are feeling the heat too! Trading was thin due to Easter holidays, but ask Japan and Taiwan, who saw their stock benchmarks drop 1.2% and 1.5%, respectively! Futures for both the S&P 500 and Nasdaq plunged 0.8% and 1%!
With Trump pressuring Powell to slash interest rates, and the Fed holding firm after a trio of cuts in 2024, the potential for market mayhem looms EERILY close. Any move to oust Powell could send the markets spinning into a frenzy that investors won’t soon forget!
Stay tuned, because this financial drama is only just heating up, and you won’t want to miss what comes next!
photo credit: www.ft.com
