When he was running for president, Donald Trump claimed how valuable it was to possess a strong dollar. Potentially entering into his final year of his presidency, Trump has called for a weaker dollar, reversing the 25-year-old strong-dollar policy.
And it looks like the Federal Reserve is giving it to him.
Despite the greenback being one of the strongest currencies in developed markets, even with a trade war lingering in the background, the buck has been paring its value as of late.
Following the Fed’s decision to leave interest rates unchanged and signal that rates will not move next year unless the economy demands it, the dollar fell.
On Thursday, the U.S. Dollar Index slipped 0.28 percent to 97.15, from an opening of 97.41. Although it is still up one percent year-to-date, the dollar has pared its gains by 1.2 percent since September.
Also from Bloomberg:
“The Bloomberg greenback index sank 0.3% on the day, in its biggest drop since October. The gauge is now down about 0.1% this year. Treasury yields fell across the curve, with benchmark 10-year rates dropping roughly 5 basis points to 1.79%.”
Could the dollar continue this downward trend heading into 2020?
Whatever the case may be, Fed Chair Jerome Powell is delivering Trump’s weak-dollar desires, and that is not good for Americans.
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