The dollar stood atop large gains early today after soaring broadly overnight on comments by U.S. President Donald Trump that he would announce the most ambitious tax reform plan since the Reagan era in the next few weeks.
The U.S. dollar dropped against the CAD on Thursday, despite the release of upbeat U.S. jobless claims data, as rising oil prices lent support to the commodity-related Canadian currency. USD/CAD hit 1.3106 during early U.S. trade, the pair’s lowest since Tuesday; the pair subsequently consolidated at 1.3101, shedding 0.33%.
U.S. stocks finished higher Thursday with the major indexes all notching the latest in a series of record closes, with energy and financial stocks leading the way. Stocks, already in the green, gained altitude on the day and the U.S. dollar climbed after Trump referenced a “phenomenal” announcement about his tax plan coming in the next few weeks. Trump’s pledge to cut taxes are expected to have a stimulative effects on asset values, but the president has been scant on details since he won the election back in November.
The dollar pushed higher against the yen, with USD/JPY rising 0.35% to 112.32 after closing in on 10-week lows in the previous session. Japanese Prime Minister Shinzo Abe and Trump are to hold a two-day summit in the U.S., starting on Friday and trade and currency issues are expected to be in the spotlight.
Gold ended lower on Thursday, pulling back after a five-session streak of gains lifted prices to their highest level in about 13 weeks. Some renewed strength in the U.S. dollar, as well as a rise among most U.S. equities helped to dull the yellow metal’s appeal. Gold fell $2.70, or 0.2%, to settle at $1,236.80 an ounce, giving back most of the 0.3% it gained a day earlier. Prices posted gains in each of the last five trading sessions to settle Wednesday at their highest level since Nov. 10.