The dollar sank to a seven-week low on Monday, January 23 against a currency basket, pressured by concerns about the early days of U.S. President Donald Trump’s administration.
In mid-morning trading, the dollar index, which measures the greenback against six major rivals, fell 0.3 percent to 100.43 led by a 0.9 percent drop versus the yen to 113.64 yen JPY=.
The safe-haven yen has been the main beneficiary of U.S. political uncertainty, rising for a second straight session against the dollar. The yen has gained nearly 3 percent since the start of the year.
The dollar index .DXY rose around 4.2 percent between Trump’s election in November and the end of last year, but has since given back more than 2.5 percent.
The greenback’s steep rally following Trump’s victory was spurred by expectations that the new administration would focus on pro-growth fiscal stimulus, tax cuts, and regulatory reform that would likely lift inflation and prompt the Federal Reserve to raise interest rates more quickly this year.
Trump’s “America first” message was followed over the weekend by coordinated protests in U.S. cities, testy exchanges between members of his top staff and media and confirmation that key trade pacts were heading for the shredder.
Meanwhile, Sterling was the other big gainer, hitting a five-week high as investors bet Britain’s Supreme Court would rule on Tuesday that the government needs parliamentary approval to trigger formal Brexit talks.
It climbed as high as $1.2477 GBP=D4, its strongest level against the dollar since Dec. 19, and pushed its way toward a two-week high against the euro at 86.20 pence per euro. GBPEUR=. The euro was up 0.4 percent at $1.0736, on course for its seventh daily rise.
