Dollar finds firm footing ahead of Trump tax-plan reveal

The dollar gained Wednesday, reaching fresh multiweek highs against the Japanese yen, as investors awaited highly anticipated details from the administration of President Donald Trump on its plans to overhaul the U.S. tax code.

The ICE U.S. Dollar Index DXY, a measure of the greenback’s strength against a basket of six rivals, rose 0.2% at 99.07, rebounding from Tuesday’s weakness. The WSJ Dollar Index BUXX,  which measures the dollar’s strength against a larger basket, was up 0.2% at 89.72.

Given that investors have been waiting for details on that plan for months, any specifics that are more or less in line with what Trump pledged during his campaign may result in a fresh round of gains for the dollar and U.S. equities.

During the campaign, Trump promised to offset corporate tax cuts with higher tariffs on imports. But recent signals from the administration suggest a greater emphasis on stimulating growth more than addressing the deficit.

Against its Japanese counterpart, one dollar USDJPY  traded at 111.17, its highest since the end of March.

Investors are also looking ahead to key central bank meetings, including the Bank of Japan, which meets Wednesday and Thursday.

Source: Bloomberg

Junior Trader Stefan Panteleev

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