US Dollar Index at fresh low for May after German Chancellor Merz secures majority
The US Dollar Index (DXY), which tracks the performance of the US Dollar (USD) against six major currencies, is sliding lower on Tuesday with market nervousness picking up again.
Market participants are assessing the recent sharp move in the Taiwan Dollar (TWD), which appreciated by more than 5% against the Greenback on Monday before retreating somewhat on Tuesday.
Markets are trying to assess if a spillover effect could occur, affecting bigger Asian currencies such as the South Korean Won (KRW), the Japanese Yen (JPY) or the Chinese Renminbi (CNH).
Meanwhile, on the geopolitical front, a swarm of headlines are making its way to the markets, with the most recent the upcoming German Chancellor Friedrich Merz, who initially fell short of a majority in the German parliament vote to become the new Chancellor, though secured the votes in a second round later this Tuesday.
On the other side of the Atlantic, US Commerce Secretary Howard Lutnick jacked up stakes for the Trump administration to deliver an initial trade deal soon by saying that the first deal needs to be with a “top ten” economy, he said on Fox News.
In Europe, the war between Russia and Ukraine is heating up with drone attacks on both sides, while Israel is further preparing a ground offensive with the goal of fully controlling the Gaza Strip.
Source: Fxstreet
