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Trying to understand what Trump really wants- USD index (USDX) in focus here (part 1)

There has been much conjecture on what exactly the US president wants to achieve from his chaotic trade policy, that has rocked the markets over the last few weeks. Does Trump want to eradicate altogether the US trade deficit? Does he believe in Free trade? Does he want to hammer the Chinese dominance in Global trade? So, many questions being asked and mostly because there is no clarity from the US administration. There can be no doubt the US must do something about all their ballooning deficits and not just on the current account. So,.the other question in all this which is being raised behind closed doors- what is the US policy on the currency? Well, we have all seen how the dollar has weakened versus all its major counterparts and certainly if one ever wanted to make US exports cheaper and imports more expensive, then a weaker dollar has a key role to play in that. The problem for the US government is how to achieve that whilst still attracting the kindness of strangers. That is to say keeping overseas investors happy to buy US bonds and stocks in the face of what might be a significant currency risk for them from a weaker dollar. Well, more on this as we move onto part 2 of this in the very next update, as the narrative here is running short of space. More on the USD index (USDX) to follow immediately, so please read on 
 

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