FX Traders Are on Alert as U.S. Dollar Intervention Risk Climbs
- JPMorgan outlines potential for Treasury, Fed selling dollars
- It would be ‘foolish’ to ignore possibility: State Street
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Foreign-exchange traders are always scanning the globe for signs of government intervention in the market -- but it’s rare for them to suspect the world’s reserve currency as a candidate.
That’s changed after U.S. President Donald Trump repeatedly signaled his preference for a weaker dollar and accused other countries of manipulating exchange rates. The administration’s rhetoric could foreshadow a shift to an interventionist policy, according to Michael Feroli, JP Morgan Chase & Co.’s chief U.S. economist. Deutsche Bank AG sees a material risk that Trump will become the first president in recent history to take measures to weaken the dollar.