USD gains as Trump-Musk tensions highlight policy uncertainty
The US dollar has strengthened 0.2% against major peers as political tensions between former President Trump and Elon Musk create uncertainty around future economic policies. Trump's criticism of Musk over EV mandates has raised questions about potential policy directions should Trump return to office in 2024. The dollar index (DXY) pushed to 104.85, with USD/JPY climbing 25 pips to 157.40 and EUR/USD declining to 1.0820. Markets are interpreting the political discord as potentially disruptive to business confidence and investment decisions. The disagreement over electric vehicle policies specifically impacts sectors tied to green energy transitions and could influence Federal Reserve considerations on economic growth projections. Technical indicators show USD/JPY approaching resistance at 157.60, while EUR/USD finds support near the 1.0800 psychological level. Traders should monitor how this political uncertainty affects risk sentiment in the coming sessions.
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