Buck strong to begin 2026

The U.S. Dollar is up against nearly all G10 peers this morning on the back of U.S. Adventurism

The Bloomberg Dollar Spot Index has advanced to its best level since before Christmas after the United States captured Venezuelan President Nicolas Maduro and his wife in a shock operation over the weekend. U.S. President Donald Trump has stated that Washington intends to “run” Venezuela in the short term, and while it is unclear what that will mean for the South American country, the development is buoying the Greenback and putting downward pressure on the currencies of other nations in the region, such as the Mexican Peso and Colombian Peso.

Maduro’s capture has also had a notable impact on commodity markets. Gold is climbing as investors look for a haven from the geopolitical tension, extending year-end gains, whereas oil is biased to decline as Traders speculate that “Trump’s Venezuela” could dump supply into the market, but the capital expenditure required to extract Venezuela’s reserves means that this is not an immediate concern but could position oil for volatile moves in the not-so-distant future.

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MXN ⇓

The Mexican Peso is one of the morning’s biggest losers against the Dollar as Traders digest what the capture of Nicolas Maduro means for the region. The Peso, which has weakened to its worst level since November, could be poised for further losses as Traders grabble with uncertainty surrounding U.S. foreign policy and the potential for continued intervention in the region.

EUR ⇓

The Euro dropped to its weakest level against the Buck since the second week of December, tumbling along with other tender as questions and concerns surround the U.S. operation in Venezuela and what that will translate into for the long-term. For now, the Buck is on a positive trend but that could change with the release of data points this week. Tomorrow, we will get Purchasing Managers Index figures for December, inflation in the form of Consumer Price Index on Wednesday, and Confidence gauges along with Producers Price Index on Thursday. The week will close out with Euro-zone Retail Sales.

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