The U.S. dollar went upward after Joe Biden announced he would drop out of the presidential race. His announcement came on Saturday, July 21, 2024, and the U.S. dollar has been slightly on the green since Monday. The USD remained briefly on the greener side of the spectrum for four consecutive days this week.
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The DXY index, which measures the performance of the U.S. dollar, shows the currency climbing above the 104.30 mark. It is also ravaging leading local currencies in the forex markets this month after Joe Biden dropped out of the race. The Chinese yuan, Indian rupee, and the Japanese yen have nosedived against the USD in July.
Analysts claim that the markets are hopeful about Donald Trump’s possibility to reclaim the presidency in 2024. “Overall, these moves still suggest investors are, for the most part, looking to Trump’s first term as the best available guide for what to expect from a potential second one,” said Jonas Goltermann, Deputy Chief Markets Economist at Capital Economics to Reuters.
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The development indicates that the markets are confident in Donald Trump’s economic policies and not that of Joe Biden’s. Both leaders have contrasting ideas on America’s economy and the U.S. dollar. The U.S. dollar has outperformed 22 of 23 leading Asian currencies this month in the forex markets. Only the Hong Kong dollar managed to remain afloat from the wrath of the USD in July.
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The Chinese yuan, Indian rupee, and Asia’s leading currency, the Japanese yen nosedived against the U.S. dollar. The Indian rupee has fallen to its all-time low of 83.73 and the Chinese yuan dipped to its seven-month low. Additionally, the Japanese yen was the worst hit as it plummeted to its 1990s low against the U.S. dollar.