The dollar continued to show resilience on Monday, while Asian stock markets expressed cautious optimism. Investors were tensely awaiting Donald Trump's first steps in his second term, and speculated that Japan could revise its key rate this week.
Donald Trump will be sworn in at noon ET (17:00 GMT). At a rally on Sunday, he declared the beginning of a "whole new era of American strength," fueling expectations for his first decisions of the new term.
The president has promised to sign about a hundred executive orders in the first hours after the inauguration. Key initiatives include pledges to deport illegal immigrants, cut red tape, and make active use of the country's energy resources.
On Friday, Trump demonstrated his trademark unpredictability by launching a digital token. He also unexpectedly promised to "save" the popular Chinese app TikTok, which under new legislation has been banned in the United States on national security grounds.
With U.S. financial markets closed for a holiday on Monday, the reaction to the presidential inauguration is likely to come later, starting with the currency market. Traders are paying particular attention to the prospects for changes in Washington's tariff policy. The impact of new economic steps could become apparent as early as Tuesday, when Asian markets open.
Trump also showed a willingness to maneuver diplomatically: His phone call with Chinese President Xi Jinping on Friday was reportedly constructive.
As of Monday morning, U.S. stock futures in Asia were slightly lower. The dollar, which has been strengthening since the fall on the back of positive economic data and a successful Trump election campaign, remained stable.
Asian investors are cautious, analyzing the potential impact of the first decisions of Trump's new term and the upcoming meeting of the Japanese central bank.
Japan's Nikkei index (.N225) showed a 1% gain on Monday, setting a positive tone in the region. Investors' attention is focused on the U.S. economic agenda and key statistics that could influence the future outlook for markets.
U.S. stock indices pleased investors last week, with the S&P 500 (.SPX) posting its best weekly gain since November and the Nasdaq (.IXIC) posting its biggest gain since December. The results came after data showed inflation was slowing, supporting optimism about the strength of the U.S. economy.
The US dollar remains strong, up 14% against the euro since September. It was at $1.0273 on Monday, close to a two-year high. However, experts warn that markets have priced in potential tariff hikes, which could limit further gains.
President Trump has taken an aggressive stance on tariffs, threatening 10% tariffs on global imports, 60% tariffs on goods from China, and a 25% surcharge on Canadian and Mexican goods. Trade experts warn that such measures could disrupt global supply chains, raise costs for companies, and trigger retaliatory sanctions from affected countries.
The Canadian dollar hit a five-year low on Monday, falling to $1.4486 per US dollar. The Mexican peso also came under pressure, hitting a 2.5-year low of 20.94 per dollar on Friday. The moves underscore the unease surrounding the currencies of the US's neighbors amid tariff uncertainty.
Bitcoin slipped early in Asian trading but remained above $100,000, remaining attractive to investors despite volatility. Meanwhile, the yield on the 10-year Treasury note ended last week at 4.61%, up nearly 100 basis points in the past four months.
Amid a tense global economic environment, market attention remains focused on the actions of the US. The outlook for tariffs and inflation will shape the agenda for the coming weeks, as investors continue to analyze the impact of these factors on global financial flows.
China remains at the center of the trade standoff, with the United States seeing it as a prime target for tough tariffs. Meanwhile, investors are welcoming positive economic data from China that beat expectations, fueling interest in regional markets.
How will Trump and Xi Jinping's relationship play out?
The economic and political ties between the United States and China play a key role in analysts' forecasts. Ken Peng, head of Asia investment strategy at Citi Wealth, noted that the outcome of the talks and interaction between the two leaders, Donald Trump and Xi Jinping, will be the most important indicators of future trade policy.
"Their personal relationship now plays the role of not only a political but also an economic indicator," Peng emphasized during a briefing in Singapore.
Amid positive economic data, Chinese stock indices ended last week with growth. Futures also pointed to a cautious rise in Hong Kong stocks at the open.
The Chinese yuan is showing resilience, settling at 7.3355 per dollar in offshore trading. However, it may take time to adjust to the new trading conditions.
The Australian dollar, closely linked to China's trade flows, has started to recover from a five-year low. The currency could strengthen to $0.6322 if Trump's tariff plans are less aggressive than expected, according to Joe Capurso, a strategist at the Commonwealth Bank. For now, the rate has stabilized around $0.62.
The Japanese yen strengthened last week on signals from the Bank of Japan that were seen as preparations for a rate hike. Markets say there is about an 80% chance of a 25 basis point hike on Friday. The yen remained stable on Monday, trading at 156.17 per dollar.
The development of US-China trade policy in the coming weeks could be a key factor for global markets. With global leaders' meetings and central bank decisions in focus, investors continue to assess the long-term outlook.
Commodity prices continue to show stability. Gold remains at $2,694 per ounce, while Brent crude rose to $81.21 per barrel. However, it was the unexpected activity in the cryptocurrency sector associated with Donald Trump that attracted the most attention.
The new cryptocurrency issued by Donald Trump has become a sensation. On Monday, it soared by 73%, reaching a price of $46.06 per token, leading to a market capitalization of about $9.2 billion, according to CoinMarketCap. In just 24 hours, the trading volume was an impressive $42.2 billion.
Initiated as a meme coin, the $TRUMP token quickly attracted the attention of not only investors but also the crypto community. The move expands Trump's presence in digital finance, which already includes World Liberty Financial. The launch of the meme coin coincided with his return to the US presidency, adding interest to the project.
The sharp rise in the value of $TRUMP has raised questions about the influence of public figures on speculative markets. Justin D'Anetan, an independent crypto analyst based in Hong Kong, expressed concern about how political leaders can influence such assets.
"Can public figures use their influence in such situations? This is an issue that regulators cannot ignore," he said.
Peter Schiff, chief economist at Euro Pacific Asset Management, compared $TRUMP to the "new digital gold," highlighting its phenomenal growth. While experts debate the coin's long-term prospects, its rapid rise has become a landmark event in the world of digital assets.
Donald Trump has already announced his intention to become a "crypto president." In his new role, he plans to issue executive orders that will simplify regulation of the cryptocurrency industry and create conditions for its development. This announcement has increased interest in his cryptocurrency projects, as well as in the broader prospects for the introduction of digital assets into the economy.
Today at noon ET (17:00 GMT), Donald Trump will officially take office as president. His first decisions in his new term, especially related to cryptocurrency, will be closely watched by the markets, as they could set a new direction for the digital economy.
Trump's crypto debut, combined with his plans for the presidency, promises to be a key topic not only for investors but also for regulators. A new wave of digital assets is poised to change global financial flows, and the ambitions of the new US leader could play a key role in this.
Donald Trump's plans to loosen regulations in the cryptocurrency industry have caused a strong response in the community. Following his election victory in November, leading digital assets, including Bitcoin, have begun to show significant growth, reflecting market expectations.
Bitcoin, the world's largest cryptocurrency, is showing resilience in a volatile environment. On Monday, it traded at $101,826.51, down 2.6% from its previous high, but up more than 10% in a month. This growth suggests that investors are optimistic about the prospects for the new cryptocurrency policy promised by Trump.
The impact of regulatory easing extends beyond one asset. Bitcoin remains a barometer of sorts for the entire crypto market, reflecting investor sentiment and expectations regarding the new conditions. Trump has promised to remove regulatory barriers, which could facilitate institutional investment and accelerate the mass adoption of cryptocurrencies.
Bitcoin's rise after the election suggests that the market has already begun to factor in changes related to the new president's policies. Entrepreneurs and traders expect Trump to focus on creating a more favorable environment for digital assets. This move could give the United States a strategic advantage in the global cryptocurrency race.
Donald Trump's plans for cryptocurrency policy have already changed the mood on the market. His plans to support the digital economy set the stage for further growth in Bitcoin and other assets, with market participants eagerly awaiting the president's first decrees.
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