Latest news with #U.S.DollarIndex
Miami Herald
2 days ago
- Business
- Miami Herald
Trump Oversees Worst Dollar Start to Year in Over Half a Century
The U.S. dollar has had its worst start to a year since 1973, weighed down by President Donald Trump's frenetic trade policy, a worsening outlook for the country's ever-bloating public debt pile, and fears about the independence of the Federal Reserve. The Financial Times reported that the U.S. Dollar Index was now down by 10 percent over the course of 2025, making it the weakest performance since the end of the Bretton Woods system, which was underpinned by the dollar's convertibility to gold. The news concides with the U.S. Senate gearing up to pass Trump's much-tweaked One, Big, Beautiful Bill, the tax-cutting provisions of which are set to expand the deficit by trillions of dollars over the coming decade. Trump upended the global trading system in April when he introduced individualized "reciprocal" tariffs on trade partners, intended to reflect the barriers he said the U.S. faces around the world. He later paused those tariffs for 90 days amid market turmoil and fears of sparking a U.S. recession, to give space for trade talks, and recently indicated the deadline is not hard if those discussions are making progress. Import tariffs typically strengthen the currency. But Trump's disordered approach to trade—which his allies say is intentional and increases the pressure on partners, key to his approach to dealmaking—coupled with U.S. debt worries and his pressure on the Fed to cut interest rates have put downward pressure on the dollar. A key purpose of Trump's "America first" trade policy is to protect and rebuild the domestic manufacturing sector, which may benefit from a weaker dollar, but any advantage would be mitigated by the retaliatory import tariffs against the U.S. A weak dollar—the world's reserve currency—also has painful reverberations around the world for those who conduct trade in U.S. dollars. Global companies with lucrative U.S. divisions will now see weaker dollar revenues as they convert them into other currencies. This is a breaking story. Updates to follow. Related Articles US STEM Students Are Struggling. Slashing Federal Research Funds Will Set Them Back Further | OpinionPlans to Sell Millions of Acres of Federal Land DroppedFormer Labor Secretary: Here's How Trump Should Rebuild American Manufacturing | OpinionIran's Supreme Leader Challenges Trump 2025 NEWSWEEK DIGITAL LLC.
Newsweek
2 days ago
- Business
- Newsweek
Trump Oversees Worst Dollar Start to Year in Over Half a Century
Based on facts, either observed and verified firsthand by the reporter, or reported and verified from knowledgeable sources. Newsweek AI is in beta. Translations may contain inaccuracies—please refer to the original content. The U.S. dollar has had its worst start to a year since 1973, weighed down by President Donald Trump's frenetic trade policy, a worsening outlook for the country's ever-bloating federal debt pile, and fears about the independence of the Federal Reserve. The Financial Times reported that the U.S. Dollar Index was now down by 10 percent over the course of 2025, making it the weakest performance since the end of the Bretton Woods system, which was underpinned by the dollar's convertibility to gold. This is a breaking story. Updates to follow.
Qatar Tribune
3 days ago
- Business
- Qatar Tribune
Turkish exporters could see benefit in stronger euro: Expert
Agencies Turkish exporters see the rise in the euro/U.S. dollar exchange rate as a potentially beneficial development, an expert opined recently, while the uncertainties over the independence of the Federal Reserve (Fed) continued to fuel concerns. U.S. President Donald Trump is reportedly considering selecting a new name to chair the Fed in September or October. The Fed's likelihood of making three rate cuts by the end of the year increased, causing the euro/U.S. dollar exchange rate to rise to 1.1745 this week, a nearly four-year high. The decline in the U.S. dollar showed that investors responded to Trump's decisions by selling their dollar assets, putting downward pressure on the U.S. Dollar Index, which fell to 97.076 on Thursday, its lowest since March 2022. Tonguç Erbaş, general manager of Türkiye-based financial services firm Ahlatci Portföy, told Anadolu Agency (AA) on Friday that the rise in the exchange rate has been positive for Turkish exporters, and the European Central Bank (ECB)'s tight monetary stance to bring down the bloc's inflation to 2% also contributed to the rise. Erbaş stated that the ECB is gradually easing its policy to bring stability to the EU economy, while concerns over tariffs are largely limited, boosting market confidence. Meanwhile, the Fed remains cautious amid debates that Trump could likely install a 'shadow chair' to the Fed. 'The rise in the euro/U.S. dollar exchange may have been positive for Turkish exporters because half of Türkiye's exports go to Europe, but most of our imports are dollar-based,' he said. 'The rise in the exchange rate is allowing euro-based revenue to increase when converted to Turkish lira,' he added. Erbaş noted that the Turkish industrial sector in particular could benefit from the exchange rate, but the exchange rate risk on the import side needs to be monitored closely. Türkiye's exports totaled $110.9 billion in January-May this year, 39% of which were to the EU, up 7.5% versus the same period last year, according to the data from Turkish Exporters' Assembly (TIM).
CNBC
4 days ago
- Business
- CNBC
Stock market reclaims February record peak. How the fundamentals and technicals look now vs. then
Just as they say you never step into the same river twice, the view from a given summit is never quite the same upon a second visit. The S & P 500 has fully scaled its way to its first record high in more than four months on Friday, recovering what was at the intraday trough a full 20% loss with rare speed, feeding off a deep reservoir of worry filled during the April tariff panic that has not yet fully been depleted. .SPX YTD mountain S & P 500, ytd The index finished Friday not quite half a percent above the old peak from Feb. 19, allowing for a tidy little now-vs.-then analysis of how the fundamental, technical and sentiment conditions compare. Because earnings last quarter trounced forecasts and projections for the coming twelve months are higher, the market carries a slightly lower valuation (22-times forward estimates compared to 22.5 in February). This remains pretty rich relative to history, for sure, though multiples rarely sag of their own weight when profits are rising and the Federal Reserve is not tightening. And the multiple of the equal-weighted S & P, as shown, is stuck near its decade average. Without diving into the details here, many market handicappers have lately produced studies showing that there has been upward drift in "normal" valuations over the decades, largely because the index is higher quality, less cyclical and corporate profits as a proportion of GDP have been in structural ascent. Also lower now compared to at the prior index high: The U.S. Dollar Index , crude-oil prices and the 10-year Treasury yield . Credit spreads are slightly less tight yet are just trivially higher. And we are now closer to the Federal Reserve's next interest-rate cut than in February, no matter when that should come relative to the market's current odds-on bet in September. Comeback not quite trusted Another difference to note is that investors and strategists loved and trusted the market on the S & P 500's first run above 6,100 but are more suspicious of it now. Not outright bearish, and certainly not entirely sitting the market out, but wary of the staying power of the rebound. The long-running Investors Intelligence survey of market advisory services shows an unusually tepid mood in the face of a 27% rip higher. Here's is the spread between self-professed bulls and bears, which if nothing else means that blithe, unfounded optimism is not among the impediments to a further advance in stocks. By Deutsche Bank's calculations, aggregate equity exposure across all classes of investors remains subdued, as of Friday registering in the 30 th percentile of all readings since 2010. These indicators seem unusually impacted by cautious positioning among systematic funds that take their cue from volatility levels and trend momentum. Wall Street strategists, too, have been whipsawed and left looking up at the index itself. At the start of the year, the CNBC Market Strategist Survey showed a median S & P 500 target of 6600, which would've meant a 12% gain for 2025, with the lowest target at 6500 – an unusually upbeat consensus for any year. Currently, after rampant slashing of targets in response to the springtime selloff, the median target is 6057, nearly 2% down from Friday's close at 6173. Circle and trader speculation If this were all there were to observe about investors' expectations and risk posture, it would amount to a pretty clear net positive for stocks' forward prospects from here. Yet the upwelling of speculative aggression and retail-trader stampedes into racy, illiquid and heavily shorted stocks can't be fully set aside, or dismissed as a source of frothy excess and erratic price action. Bespoke Investment Group notes that one in every seven Russell 3000 stocks is up at least 50% from the April 8 th market low. The VanEck Social Sentiment ETF (BUZZ) , built to capture the names most buzzed about, has ramped 50% in 11 weeks and has finally exceeded its peak at the crest of the last meme-stock craze in early 2021, as has the Goldman Sachs Retail Favorites basket. Stablecoin dealer Circle Internet Group completed its IPO three-plus weeks ago at $31, a price at which several early investors were happy to unload some of their shares as part of the offering. It raced higher by more than eight-fold by last Monday, hitting $263, before heaving back to $180 by Friday, often while trading more than half its share float in a day. CRCL 1M mountain Circle, 1 month In a certain fun-seeking, fast-money precinct of the market, Circle is the new CoreWeave , which was the new Super Micro , which for a brief time was the new Nvidia – at least in terms of being the fresh new ticker offering open-ended leverage to an irresistible technology trend. This is not to scold or shame the traders playing such themes and flipping other long-shot names. Such action is part of what makes bull markets, and where it crosses from supportive enthusiasm to overheated instability is impossible to discern in advance. Along with the powerful run higher in the capital-markets stocks, with the likes of Goldman Sachs and JPMorgan at fresh price and valuation highs, it suggests a market revving its motor for an exuberance phase of some dimension. As I wrote here six weeks ago , before the latest 3.6% gain in the S & P 500: "For now, stocks are supported to the extent the Big Money still feels under-invested and compelled to pay up to play. Which could, eventually, lead to the kind of fun-seeking that usually precedes a period of chagrined payback." This remains roughly the case, though of course with prices now incorporating a somewhat more favorable set of outcomes than they did even then. S & P 500 up 5% this year Friday's sharp, fleeting intraday pullback on news that President Trump was ending trade talks with Canada in retaliation for a pending Canadian digital-services tax was a somewhat clarifying moment, a strong hint that the market is now banking on no re-escalation of trade frictions and indeed continued dilution of the threatened tariffs. There's also a chance that the equity-market rally has given investors more comfort in the baseline U.S. economic-growth picture than the data might support. Friday's personal income and spending and PCE inflation data were noisy but largely shy of the Street's hopes. Next Thursday's employment report will have considerable sway in this debate, as the White House agitates for a Fed rate cut that seems so far rather unlikely at the late-July meeting. If you want to trigger an argument with a serious investor this weekend, tell them that the first half of 2025 has unfolded in a rather normal, expected manner. Coming into the year, the almanac-readers were telling you that the third year of a bull market and the year after back-to-back 20% annual gains tend to be rockier and less rewarding. Same for the first half of a post-election year. And here we are, after much rocking and wheezing along the way, with the S & P 500 up 5% for the first half – almost exactly half the long-term annualized performance of the market. Even the way the tape has responded to the severe correction fits with known patterns. Near-bear-market episodes of the past are a regular touchstone of mine. These are sharp market shocks that cause an S & P 500 drop of just shy of 20%, or 20% only on an intraday basis (such as this year's selloff). The market's trajectory of the past several months most resembles two such instances, the rallies off the lows in 1998 and late 2018. The present market recovery is not without its blemishes. An unusually small percentage of stocks made a new high along with the index itself, even though overall breadth has been strong. The median S & P 500 stock remains more than 12% below its own 52-week high. And the S & P 500 is getting technically overbought in the near term for sure, though it showed just a few weeks ago it's capable of cooling off through a benign pause rather than a sharp setback. As a general matter, new highs are more bullish than hazardous, and the index tends not to fail in a serious way just after reaching a new record. Of course, it did exactly that in February, making a token new high above the December peak, only to buckle into what became an outright panic. But what are the chances investors get struck by lightning on the same summit twice?
Yahoo
4 days ago
- Business
- Yahoo
5 Macro Trends Likely to Send Bitcoin and XRP Skyrocketing in 2026
Macroeconomic factors have big implications for Bitcoin and XRP. Five such factors are currently becoming tailwinds for these two coins. Most of these trends will take a couple of years to play out in full. 10 stocks we like better than Bitcoin › Water seeks its own level, and so does money. When cash becomes plentiful in the financial system, scarce digital assets such as Bitcoin (CRYPTO: BTC) and XRP (CRYPTO: XRP) often move sharply higher. Looking toward 2026, there are five macroeconomic forces that appear ready to remove several roadblocks that have held crypto back during the past two years. XRP and Bitcoin are likely to go higher as a result. Here's why each matters. Think of liquidity as the total pool of spendable cash in the global economy. When central banks add money to their respective national financial systems, usually by enlarging their balance sheets, investors have more capital to deploy, and riskier assets like major cryptocurrencies benefit first. And since mid-2024, the total combined assets of the U.S. Federal Reserve, the European Central Bank, and the Bank of Japan have ticked higher for multiple quarters in a row. During the last comparable upswing, from March 2020 to April 2021, Bitcoin leapt 500%, while XRP surged 483%. So if major central banks keep refilling the punch bowl, history suggests another party for crypto prices, assuming nothing spoils the fun. Interest rates set the cost of borrowing money from central banks. Lower borrowing costs make cash cheaper and thus push investors to seek higher-return alternatives to government bonds, including leading digital assets like Bitcoin and XRP. The Fed is now widely anticipated to trim its benchmark interest rate by mid-2026, which implies at least a couple of interest rate cuts in the very near future. In 2019, when the Fed cut rates by almost 1 percentage point, Bitcoin rose 120% in five months, and XRP climbed 17%. That exact performance probably won't be replicated this time around, assuming things proceed as expected. But it will still likely be bullish for these coins. The U.S. Dollar Index is down roughly 8% so far in 2025 as worries over trade tensions and federal deficits mount. A weaker dollar means that global investors need fewer units of their local currency to buy dollar-denominated Bitcoin or XRP, which could have the effect of juicing demand. In 2017, a similar dollar slide that lasted through the start of 2018 preceded a jump in Bitcoin's market cap by a multiple of 13.5, and pushed XRP to rise by a shocking multiple of 34.6. As long as tariffs remain a topic of conversation for the U.S. economy, there could be a tailwind in play here. Government bond yields represent the safest return for investors. The 10-year U.S. Treasury yield has fallen from 4.7% in January 2025 to near 4.3% today. When safe yields drop, the gap between bonds and non-yielding assets such as crypto narrows, making coins more appealing in comparison. After yields slid in late 2018 until shortly after the start of their rapid climb back up in October 2021, Bitcoin's price rose by 572%, and XRP's followed, climbing 84% in the tail end of the period. When people have more disposable income, they invest more, and when they have invested in safe assets sufficiently, they move on to investing in riskier ones like Bitcoin or XRP. Paychecks are stretching a bit further after accounting for inflation recently; average hourly earnings in the U.S. rose 1.4% from March 2024 to March 2025. During the economic stimulus of the 2020 to 2021 period, fresh cash on the sidelines helped power Bitcoin's rise. There's no similarly strong stimulus this time around, but that doesn't change the fact that investors with deeper pockets are more likely to devote some of their money to cryptocurrencies like Bitcoin or XRP. Before you buy stock in Bitcoin, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the for investors to buy now… and Bitcoin wasn't one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you'd have $704,676!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you'd have $950,198!* Now, it's worth noting Stock Advisor's total average return is 1,048% — a market-crushing outperformance compared to 175% for the S&P 500. Don't miss out on the latest top 10 list, available when you join . See the 10 stocks » *Stock Advisor returns as of June 23, 2025 Alex Carchidi has positions in Bitcoin. The Motley Fool has positions in and recommends Bitcoin and XRP. The Motley Fool has a disclosure policy. 5 Macro Trends Likely to Send Bitcoin and XRP Skyrocketing in 2026 was originally published by The Motley Fool
