USD eyes tariff boost: Bessent targets billions in annual revenue

USD sentiment strengthens as Treasury Secretary nominee Scott Bessent outlined plans for 'several hundred billion' dollars in annual tariff revenue, potentially bolstering dollar inflows. The prospect of increased tariff collections could provide fiscal support for the US economy while potentially strengthening the dollar through increased demand for USD to pay tariffs. Bessent also mentioned a positive US-Germany reset, which could ease transatlantic trade tensions and support EUR/USD stability. Market participants are weighing the inflationary impact of tariffs against potential revenue benefits. Technical levels show USD index testing resistance at 106.50, with support at 105.80. The tariff revenue projections suggest sustained dollar strength in the medium term, though implementation details and trading partner responses remain key variables. Traders should monitor upcoming policy announcements and international trade negotiations for directional cues.