TOKYO- The US dollar slipped to a one-week low versus major peers on Wednesday, looking to extend a three-day decline from a one-week peak as the market catches its breath following the frantic rally in the wake of Donald Trump’s election.
A boost to the dollar and other traditional safe-haven currencies like the yen overnight proved short-lived, after Russia’s foreign minister said the country will “do everything possible” to avoid the onset of nuclear war, hours after Moscow announced it would lower its threshold for a nuclear strike.
Bitcoin pushed to a fresh all-time peak above $94,000, carried by expectations for a friendlier regulator environment for cryptocurrencies under Trump.
The dollar index – which measures the currency against six major peers, including the yen and euro – fell to a low of 106.07 for the first time since Wednesday of last week, and stood at 106.18 at 0247 GMT.
The index climbed to a one-year high of 107.07 on Thursday, buoyed by expectations for big fiscal spending, higher tariffs and tighter immigration under the incoming US administration, measures which economists say could foster inflation and potentially slow Federal Reserve easing.
Investors are still waiting for Trump to name a Treasury Secretary, following the announcement of several other high-profile appointments, including Wall Street CEO Howard Lutnick as head of the Commerce Department.
Some of Trump’s picks have provoked controversy for their relatively meagre relevant experience. “The ‘Trump Trade’ that boosted the greenback is facing challenges from Trump’s controversial cabinet nominations and the escalation in the Russian-Ukraine war,” DBS strategists wrote in a client note.
