The US Dollar appears to have lost momentum ahead of the FED interest rate decision next week, as the prospect of a Trump Presidency begins to worry markets. Trump has taken to twitter again to express his frustration at business leaders and Union bosses, as he looks to protect American companies by keeping them on US soil.
Trump has also claimed credit for saving 1,100 jobs at United Steelworkers, although this has been discredited as false.
it’s not the first time Trump has taken credit for saving jobs, and by using Twitter as a main source of communication he leaves himself open to criticism and fact checking. The President-elect has also added further controversial characters to his team, adding Scott Pruitt – climate change denialist to lead the environment protection agency.
Many were hoping for Trump to break away from his campaign promises, but by his choice of staff it looks as though his sceptical approach to climate change remains. As a result, the Pound is losing ground ahead of the US Interest rate decision next week.
Could the US Dollar weaken next year?
Both the Pound and Euro will remain under pressure in 2017 with the European elections and Brexit yet to unravel. This could provide opportunities for the US Dollar, and given the positive sentiment around the US economy further interest rate hikes could present themselves. T
That being said, Trump has not assumed his position in the White House yet, and with currency fluctuations already present in connection to his controversial comments and vested interests, further losses to the US Dollar may emerge in January.
Are these losses likely to balance the books for GBP/USD? Although Trump remains a controversial figure, Brexit remains a huge political and economic concern amongst investors, I would expect the Dollar to continue its momentum against the Pound.