The dollar reached a summit of almost three weeks against a basket of currencies after President Donald Trump threatened a price of 30% against the EU and Mexico this weekend.
One hypothesis that investors are making is that other countries will bury Trump’s demand and that the EU potentially is willing to accept a trade agreement that promotes the United States, said Thu Lan Nguyen in Commerzbank in a note.
“If Trump really manages to extract significant concessions from American trade partners by threatening them with prices, this could be considered positive for the dollar.”
