Dollar falls on Trump currency comments

Last week, the Dollar slumped broadly against its peers, after Donald Trump helped accelerate its recent decline by saying that the Dollar “is getting too strong” and that he would prefer the Federal Reserve to keep interest rates low. Trump’s comments came at a time when some had begun to think that perhaps the president was not as supportive of a weak Dollar as initially perceived .However he surprised the market by reiterating his view that a strong currency hurts US competitiveness, adding downward pressure on the Dollar.

Last Wednesday, the Canadian Dollar strengthened to a six week high against its US counterpart after the Bank of Canada turned less dovish, while comments by US President Donald Trump weighed on the greenback. Sounding less dovish than in January, when he said that policymakers discussed a possible rate cut, Governor Stephen Poloz said that the bank was “decidedly neutral” even as it raised its growth forecast for 2017. Poloz said that the Bank of Canada did not even consider cutting interest rates as it left monetary policy unchanged on Wednesday amid signs of strong growth, but it is too early to conclude the economic growth is sustainable.

Meanwhile, Oil Futures fell, pulling back after eight straight sessions of gains after US crude inventory data suggested that the market was still heavily supplied. Traders focused on preliminary US production estimates in the weekly EIA report that suggested domestic output was still climbing. The report also showed stockpiles at the US Crude hub at Cushing, Oklahoma, rose 276,000 barrels in the week.