Dollar Down on Renewed Risk Concerns

The US Dollar is trading in weaker ranges against its G10 peers this morning as geopolitical tensions continue to dominate headlines.

Last week was the worst week for the US Dollar in 8 months, and it has continued to weaken this morning following President Donald Trump’s announcement that the United States will impose 100% tariffs on Canada should they strike a trade deal with China. This announcement immediately followed Senate Minority Leader Chuck Schumer stating that the Democrats would block the current spending package if Republican do not defund the Department of Homeland Security.

Precious metals have extended their gains as Traders continue to seek out safe-haven assets, driving Gold past $5,000 an ounce and Silver past $100 an ounce.

The race for the nomination as the next Chairperson of the Federal Reserve has continued to heat up over the last few weeks as well. Rick Rieder, the Chief Investment Officer of Global Fixed Income at BlackRock, is the latest front-runner, with a 47% probability of being selected.

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GBP ⇑

The British Pound is up against the Greenback this morning largely as the result of politics. Andy Burnham, the current Mayor of Manchester, has been blocked by the ruling Labour Party from contesting an imminent by-election that would see Burnham’s return to Parliament. Burnham, who has a significant amount of internal party support, is gearing up to challenge Keir Starmer for the role of Prime Minister.

JPY ⇑

The Japanese Yen is up more than a percent against the Buck this morning, trading at its strongest position since November. The New York Fed conducted a rate check on USDJPY on behalf of the US Treasury on Friday afternoon, and this action spooked Traders, as it is one of the most explicit, albeit unofficial, forms of intervention. This morning’s extreme move signals that official intervention by the Bank of Japan likely took place overnight as well, but thus far officials have refused to confirm or deny their actions.

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