Trumps Immigration Ban causes Dollar to Slip

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Trumps Immigration Ban causes Dollar to Slip

Over the weekend, the newly-elected US President Donald Trump signed two orders to ban travelers from seven Muslim countries to enter the US. This decision has not only attracted worldwide criticism but also caused the dollar and stocks to fall globally.

The US dollar took another 0.2 percent dip against Japanese Yen after taking a fall of 1 percent on Tuesday as Donald Trump’s order of a ban on immigrants from seven Muslim countries stimulated protests across the US and worldwide.

The news shook the markets globally, causing the US dollar to plunge drastically against the other currencies. This proves to be a very bad news for traders worldwide, with many fearing that Trump’s policies can destabilize the global markets.

Some analysts projected that the US dollar will be at par with the euro. However, the euro is also struggling with problems and there might be economic and political implications on the euro after the upcoming elections in the Eurozone countries such as Germany, France, and Austria.

Initially, the US dollar plunged drastically against the euro, but the challenges faced by sterling helped to ease out the blow to the dollar. At present, both the US and the UK are facing an economic crisis.

Many believed that Donald Trump’s victory would see a rise in US dollar in the year 2017, but this does not seem to be the case. According to Jim Reid who is a senior strategist at the Deutsche Bank, Trump’s presidency has major changes in policy attached to it for it to be a smooth year for the markets globally.

Since the elections in November, the stocks fell drastically in the US. The Dow Jones Industrial Average fell more than 200 points, after finishing at records last week by ebbing below 20,000.

The policy-setting committee of the Federal Reserve will hold a 2-day meeting to decide whether or not to keep the rate of interest unchanged. However, investors will be observing closely for any hints of how policymakers see the risks to the economy and rate hikes timings.

There is a large amount of ambiguity surrounding Donald Trump’s victory, it is still to be seen this December if the Central Bank will increase the interest rates.

There is no guarantee on what implications will be faced by the US dollar in the near future, despite rising claims that pose the new President’s rule as a threat or a benefit to the dollar. It will be difficult to forecast the movements taken by the dollar as global markets at present are dealing with great uncertainty surrounding Trump’s presidency.

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