02 Feb DOLLAR VOLATILITY PERSISTS

The U.S. dollar was in the news recently after comments from Treasury
Secretary Mnuchin, European Central Bank (ECB) President Draghi, and
President Trump created volatility in the world’s reserve currency. Mnuchin
indicated that a weak dollar could benefit the United States as it relates to
trade and opportunities. Draghi said that a strong euro (and by extension a
weaker dollar) is understandable given strong European growth, but he also
raised concerns that if other countries start targeting specific currency levels,
it could have an impact on the ECB’s ability to meet its inflation goals. Trump
then followed up saying that he ultimately wants a strong dollar. This mixed
messaging has led some to ask why there seems to be disagreement on the
path the dollar should take, and what it means for markets.

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