Market comments on behalf of Wael Makarem Financial Markets Strategists Lead at Exness
21st January 2025
The U.S. dollar began the week on a softer note as markets awaited Donald Trump’s inauguration and the potential for sweeping policy announcements. Investors are bracing for the impact of Trump’s controversial proposals, including mass deportations, higher trade tariffs, lower taxes, and deregulation. While these measures could boost inflation and prompt the Federal Reserve to adopt a hawkish stance, political uncertainty continues to weigh on sentiment.
Elsewhere, rising expectations that the Bank of Japan (BoJ) might raise interest rates during its January 23-24 meeting adds to the dollar’s challenge. Such a move could potentially increase the yen’s appeal and pressure the dollar further.
Looking forward, investors will closely monitor today’s inauguration for clarity on the U.S. political landscape and its implications for global trade. Later this week, volatility is also expected to increase due to key economic events, including the BoJ’s interest rate decision and US PMI figures.