It is expected that Trump’s first news conference since his election win will provide more clues and details on his policy preferences after he takes office on January 20.
“Today the market is in ‘Trump-watch mode’,” said Stephen Innes, senior trader at Oanda. “He may shed some light on his trade protectionist stance.”
The two traditional trade protectionism proxies are the Chinese yuan and the Mexican Peso, both of which stand to suffer if the Trump’s campaign’s anti-globalisation rhetoric becomes policy, added Innes.
“Regarding the Chinese yuan, traders will also be on guard for currency manipulation comments,” he added. “Overall, I see a sooner-rather-than-later test of the 7 level to the dollar, which could occur after the Lunar New Year break, when interbank dealers will likely stoke their depreciation engines.”
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