The U.S. dollar revisited a one-year high against major currencies on Thursday, posting a fourth consecutive session of gains driven by momentum from Donald Trump’s election victory, which overshadowed increased expectations for Federal Reserve easing.
Bitcoin also surged to a new record high of $93,480 overnight and was climbing back toward that level early in Asian trading. Trump has pledged to establish the United States as “the crypto capital of the planet.”
Anticipated higher trade tariffs and tighter immigration policies under the Trump administration are expected to drive inflation, potentially slowing the Fed’s rate-cutting pace in the long run. Meanwhile, rising expectations of more deficit spending are boosting Treasury yields, providing additional support for the dollar.
Edison Research projected on Wednesday that the Republican Party will control both houses of Congress when Trump assumes office in January, granting him broad authority to implement his policy agenda.
“The USD is a unique currency supported by carry trades, momentum, growth differentials, and upcoming fiscal and tariff incentives,” said Chris Weston, head of research at Pepperstone.
“Although trends are not permanent unless U.S. economic conditions begin to weaken, the dollar’s strong position is likely to remain the main factor in any tradeable downturn.”
The U.S. dollar index, which measures the greenback against six major counterparts including the euro and yen, rose by 0.1% to 106.55 at 0120 GMT, having reached 106.56 earlier, the highest since last November.
The dollar saw a brief dip on Wednesday after a U.S. consumer inflation report aligned with economists’ expectations, keeping the Fed on course for a potential rate cut at their December meeting. However, the dollar quickly rebounded and reached new session highs. Long-term Treasury yields also climbed on Wednesday, extending their rise in early Asian trading, reaching 4.483% for the first time since July 1.
The dollar hit a fresh high since July 24 against the yen at 155.90 yen.
The euro slipped to $1.05595, remaining slightly above its one-year low of $1.055575 from the previous session.
The British pound lost 0.1% to $1.2698, after dipping to $1.2687 on Wednesday, its lowest point in more than three months.
Bitcoin rose around 2% to $90,395, approaching Wednesday’s record peak of $93,480.
Meanwhile, the Australian dollar stayed near its three-month low from the previous session, as slightly weaker jobs data failed to impact Reserve Bank of Australia policy expectations.
The Aussie remained steady at $0.64865, close to Thursday’s low of $0.64805.
