The US Dollar has given up ground against both the Euro and Sterling today as US President Donald Trump continues with his trade tariff rhetoric.
The NAFTA agreement with the other countries around the North American region has been a sticking point, with the President suggesting the USA have been suffering off the back of a poor deal whilst others have benefited. Yesterday the Canadian Dollar was struggling following Trump’s tweet that there will be some form of tariff, however it’s still to be seen if a figure will be introduced. In the next few weeks there will be a conclusion of the NAFTA talks and it will be interesting to see what agreement is reached and how much it could have an effect.
Trump and Europe
In the last few days, as well as close to home, President Trump has engaged in a battle with the European Union. He has suggested that the EU have been taking business from the US, making it easy for them to sell products in America but not receiving the reciprocal in the single state. The EU, in response to this have essentially written a list of products that would start to be taxed if Trump was to tariff EU exports.
Following this the US President went for the jugular suggesting he will start to tax German automobiles. Trump hasn’t shied away from discussions by suggesting a trade war would be a good thing and that they end up with positive results. However the main argument from leaders is that in the end consumers will be the ones who suffer.
President Trump has been very clear with regards to driving American industry and protecting US jobs, after all this is the key vote he went after which got him elected. Therefore the uncertainty relating to trade could well continue to take its toll on the US Dollar with the markets hanging on the leader’s every word or tweet.