Dollar losses mount as investors spooked by Mnuchin comments

The sell-off in the greenback especially hit exporters on Japan's Nikkei index, which tumbled for a second straight day, although dollar-priced oil and gold extended gains.

Dollar losses mount as investors spooked by Mnuchin comments

World Bulletin / News Desk

The dollar took another beating on Thursday after two of Donald Trump's top cabinet members talked down the currency and hinted at a more belligerent trade policy.

US Treasury Secretary Steven Mnuchin, speaking at the Davos gathering of the political and business elite, said: "Obviously a weaker dollar is good for us, it's good because it has to do with trade and opportunities."

His comments sent the US unit, which was already under pressure, tumbling with analysts suggesting it could be a part of the Trump administration's America First policy to help its own exporters.

They came days after the US announced stinging tariffs on imports of solar panels and large washing machines, angering China and South Korea.

US Commerce Secretary Wilbur Ross defended those tariffs and warned Washington would be prepared to fight back in future against countries it felt had flouted the rules.

The developments ramped up fears of a global trade standoff and worries about their impact on the world economy, which is finally moving on track a decade after the financial crisis.

"To the extent that trade is disrupted, it's probably not good for economies, for US companies and corporations, and would probably put pressure on the rising stock market," Michael Cuggino, president and portfolio manager at the Permanent Portfolio Family of Funds in San Francisco, told Bloomberg News.

The dollar's sell-off was also helped by investors betting on tighter monetary policies by major central banks, bringing them in line with the Federal Reserve.

The dollar took a hit from the developments and in Asia extended the losses, briefly falling below 109 yen for the first time since September.

Last Mod: 25 Ocak 2018, 11:58
Add Comment