Dollar Rides Best Winning Streak Since February on Trump’s Win
(Bloomberg) -- The dollar is posting a seventh-straight week of gains, marking the longest winning streak since February as traders add to wagers that potential policies under President-elect Donald Trump will support the US currency.
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The Bloomberg Dollar Spot Index rose 1.4% this week, pressuring all major currency peers lower. Traders, meanwhile, have slightly boosted their bets for a further rally in the greenback since Trump’s presidential victory last week, according to the latest Commodity Futures Trading Commission data.
Hedge funds, asset managers and other speculators held some $17.7 billion in bullish dollar positions in the week ended Nov. 12, CFTC data show. That shows a very small increase from the prior period as many traders went into the Nov. 5 election prepared for dollar gains.
“The dollar will be squarely focused on Trump and his policies,” said Brad Bechtel, global head of FX at Jefferies. “The flows into the dollar have been tremendous and I don’t think they are done yet.”
Trump’s win and his promises of sweeping tariffs have fueled the dollar rally, with the currency near its highest level in two years.
Meanwhile, Federal Reserve Chair Jerome Powell said on Thursday that there is no rush to lower interest rates, with the US economy performing “remarkably” well. Those remarks, combined with robust economic data on Friday including advances in retail sales, pushed traders to bet on a more gradual interest-rate cutting cycle.
--With assistance from George Lei.
(Updates with positioning data from second paragraph)
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