US dollar a full cent higher
Was there really a question about whether the US had abandoned the strong dollar policy?
From time to time, I come to the conclusion that no one reads anything but the headlines. Mnuchin's comments were very matter-of-fact. He said -- rightly -- that a softer dollar would benefit exports in the short term, but that in the long-term the dollar would strengthen.
He's said the same thing before.
But it was an excuse to sell the dollar as it was crumbling already.
Now this looks like Trump's comments have turned it around.
"The dollar is going to get stronger and stronger, and ultimately I want to see a strong dollar," Trump said.
That's different from April when he said the dollar was "getting too strong".
Ultimately, I don't think the Treasury or the White House is doing anything to manipulate the dollar or to drive it higher or lower. It's all just spin and everyone is so deep in the spin-zone that only the headline sentiment matters.
The good news is that some measure of volatility is back in the market. EUR/USD is down more than 100 pips on the headlines and it's the same thing (or more) right across the board.
President Trump: Ultimately I want to see a strong dollar from CNBC.
