Since Trump’s Mexico tariff announcement came on Friday night, should US Dollar pairs rebound quickly once the market opens back up on Sunday?
Indices will gap up. USD will, as usually, follow little logic. So no idea what it will be doing. Noone here can tell you either, and no bank or market researcher can tell u either.
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USDMXN will probably gap down. Or maybe not who knows.
Dollar pairs went down not just because of tariffs on Mexico, had more to do with Powell’s remarks being seen as bearish for USD, as well as the weak non farms payrolls (NFP) report that came out.
USD will regain slightly but not much as he said market data has been weaker and is definitely pricing in a potential rate cut pretty soon (long term). I would say I’m glad I still have my long CADJPY & AUDCAD since it was crushing before the market closed and I feel a slight surge will happen when the markets resume for the CAD pair. USD economically has run it’s course I think the labor market is already tight as it is and we are still on historical lows as far as unemployment rates so I believe it’s starting to finally dwindle down now and we are starting to feel the slow down process.
The market has become used to Pres Trump’s approach to negotiations and the use of twitter so perhaps the word ‘unexpected’ might not be entirely correct.
Think of context - the Mexican Govt’s response was one of calm, pretty clear there was talking behind the scenes and into the mix - Pres Trump heading to Europe in a long pre-arranged visit.
As momo says - the market is focused on the Fed’s intentions.