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The US dollar strengthened on Tuesday morning as Donald Trump revealed some of his tariff plans on social media. The president-elect said that he would In addition, products made in China will be charged an extra 10% above existing tariffs. Donald Trump’s comment helped the US dollar rise against the Mexican peso and hit a four and a half year high against the Canadian dollar. Responding to Trump’s suggested plans, the Chinese embassy in Washington stressed that “no one will win a trade war or a tariff war.”Media news outlets suggested that president-elect Donald Trump has chosen billionaire hedge fund manager, Scott Bessent, to be the next US Treasury secretary. Some market analysts reported that Bessent is in favour of pro-growth and deficit-reduction policies, a factor that could satisfy market participants worried about the size of the US budget deficit and the inflationary impact of tariffs.
German Business Confidence Falls AgainAccording to an Ifo survey, the German Business Climate Index fell to 85.7 points in November, down from 86.5 points in October. Business morale dropped as well as expectations as businesses suggested that the economy performs poorer than originally anticipated.Market analysts at Ifo noted that “the German economy is lacking strength. Commenting on the survey’s figures, the Ifo’s head, Clemens Fuest, told Bloomberg that just lowering the corporate tax would not be enough to spur growth adding that the German government would have to implement a more comprehensive policy.Economists at ING wrote in a note that “all in all, today’s Ifo index adds to the evidence that the German economy remains stuck in stagnation and that after meagre growth in the third quarter, a (technical) winter recession looks likely.”BoE Deputy Governor Says Inflation Battle Still Not WonThe Bank of England (BoE) deputy governor, Clare Lombardelli, said that “the UK economy has made good progress on disinflation. The shocks that drove inflation up have dissipated and inflation has returned to around target. But the more persistent components of inflation and uncertainties around how the labour market will evolve are cause for concern. So, we need careful observation of all the relevant economic data and intelligence as we seek to gradually reduce policy restriction.” Lombardelli who has just been appointed as deputy governor for monetary policy suggested that , noting that the BoE would need more data on wage and services inflation growth to determine whether they head down close to the bank’s target range.
ECB’s Lane: Policy Shouldn’t Remain Restrictive For LongThe European Central Bank (ECB) policymaker Philip Lane said that and added that the policy should respond to both downside and upside risks to inflation.In an interview with “Les Echos” news outlet, Lane noted that services price levels should come down suggesting that the job on inflation is not yet done. The Irish banker mentioned that the ECB has a data dependent approach meeting by meeting and forecast that the last stage in the battle against inflation will be completed during next year.More By This Author:UK And Canada Inflation Reports Draw Attention, Goldman Sachs Sees SP500 To 6,500 In 2025Spotlight On US CPI Inflation ReportSNB Cuts Interest Rates: Forecast For The Swiss Franc
US Dollar Rises As Trump Reveals Tariff Plans
