The dollar declined in the wake of U.S. President-elect Donald Trump announcing he will nominate hedge fund manager Scott Bessent as Treasury Secretary, XTB’s Kathleen Brooks said in a note.
“Bessent is seen as an antidote to Trump’s most extreme economic views,” she said. He favors less government spending and is expected to advocate a slow and steady approach to potentially inflationary trade tariffs.
This could boost risk sentiment, reducing safe-haven flows to the dollar, Brooks said.
However, dollar declines will be limited as the U.S. economy is outperforming. The dollar could still “trade with an upward bias into year end, and any weakness could be used as a buying opportunity,” Brooks added.
The DXY dollar index falls 0.4% to 107.101.