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  • Trump Deflates USD Ahead of Inflation Data

    From marketpulse.com

    Donald Trump added another unusual action to his growing list of Presidential duties. It is usually the job of the Treasury Secretary to lament the strength of the dollar and point to China for their hand in manipulating their currency. This time the president-elect could not wait for after his inauguration and gave an interview to the Wall Street Journal where he said the American currency was “too strong”. The USD has lost close to 1 percent versus majors since the interview was published. U.S. consumer prices will be released on Wednesday, January 18 at 8:30 am EST with a forecast of 0.3 percent rise ... (full story)

A weaker dollar means more money in circulation if rates remain the same. If rates are increased it makes it much harder for the incoming administration to leverage money to pay for things like infrastructure among other things. The interesting thing about this is, it is in the FED's interest (no pun intended) to raise rates. The higher the interest rate the more the US government has to pay back, which means more profits for the private institution. And thus the cycle of destruction continues.
I want to be a Jedi Warrior like my father and his father before him!
trump effect on USD will not last long. As I looking at my charts, some currencies that had formed head-and-shoulder and traders expected them to fall overshoot and gave some the belief that head-and-shoulders failed. However, my experience tells me it is always like this: the pairs rate of exchange fall below or fly above the lines we draw. i am talking more specifically about usd/nzd. i think it is best to start selling the pair and drive it down to 68-64 in the medium term. what you traders think of usd/nzd?
FYI, all profits by the Fed are paid back to the US Treasury. According to Forbes in 2014 "The Federal Reserve released its annual income report Friday and the central bank says it will transfer approximately $98.7 billion to the U.S. Treasury, a record." The numbers for 2015 were similar.
Quoting Graviton
FYI, all profits by the Fed are paid back to the US Treasury. According to Forbes in 2014 "The Federal Reserve released its annual income report Friday and the central bank says it will transfer approximately $98.7 billion to the U.S. Treasury, a record." The numbers for 2015 were similar.
Do you have a link to that article you are citing? If that were the case then the US treasury should have a surplus. Why is it always mentioned about the costs of the US borrowing money in relation to their debt, is being charged almost at a 4 to 2 ratio in relation to the rates assessed when borrowed and what interest has been accumulated in the time it takes to when they pay it back?
I want to be a Jedi Warrior like my father and his father before him!
Quoting kamarkhi
trump effect on USD will not last long. As I looking at my charts, some currencies that had formed head-and-shoulder and traders expected them to fall overshoot and gave some the belief that head-and-shoulders failed. However, my experience tells me it is always like this: the pairs rate of exchange fall below or fly above the lines we draw. i am talking more specifically about usd/nzd. i think it is best to start selling the pair and drive it down to 68-64 in the medium term. what you traders think of usd/nzd?
I think you are right to some degree, but depends on what the markets is trying to anticipate after Trump is sworn in. As of right now policy is going to dictate what direction the dollar is going to go in the medium term as Trump as not been specific and my guess that is what the market is waiting for. The NZD/USD possible that you are right to sell, but depends what time frame you are trading the pair. Daily, I am waiting on the closing of the candle before I put in an entry.
I want to be a Jedi Warrior like my father and his father before him!
From Reuters
http://www.reuters.com/article/us-usa-fed-payments-idUSKBN14U24K

The interest paid by the Fed to major banks last year jumped to $12 billion as the central bank's chief tool for raising rates nationally provided a boon to some of the country's largest financial institutions.

In preliminary estimates of its 2016 results, the Fed said that its year-end remittances to the U.S. Treasury are expected to fall to $92 billion, down $5.7 billion from a record $97.7 billion transferred in 2015.

Part of the decline is due to a drop of about $2.6 billion in what the Fed earns on its holdings of U.S. Treasury bonds and mortgage-backed securities accumulated in fighting the 2007 to 2009 financial crisis.
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Trump wants weaker dollar because if otherwise, goods from the US, especially goods produced/manufactured by Trump's constituents, will become more and more expensive, hence resulting in more manufacturing jobs lost and/or outsourced to reduce costs. Trump cannot devalue US currency without currency intervention, which goes against Republican policies.

To me, he is all talk.
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