ForexLive European FX news wrap: Dollar eases ahead of Trump inauguration

Headlines:

• Reminder: US markets will be closed today
• Weekly update on interest rate expectations
• Bitcoin at fresh record highs as Trump meme coin sparks buying fever
• ECB’s Holzmann: A rate cut is not a foregone conclusion for me at all
• China reportedly set to promote Zou Lan to PBOC deputy governor
• Germany December PPI -0.1% vs +0.2% m/m expected
• Switzerland December producer and import prices 0.0% vs -0.6% m/m prior
• SNB total sight deposits w.e. 17 January CHF 445.3 bn vs CHF 445.1 bn prior

Markets:

• EUR leads, JPY lags on the day
• European equities little changed; S&P 500 futures down 0.1%
• Gold up 0.2% to $2,707.06
• WTI crude flat at $77.33
• Bitcoin up 5.3% to $106,527

It was a quiet session but understandably so with US markets closed for the long weekend.

That said, the dollar is down on the day after some “positive talks” between Trump and Xi over the weekend. That potentially could pave the way for softer tariffs and that is what’s weighing on the dollar. China vice president, Han Zheng, is set to attend Trump’s inauguration in a sign of hope to start the new presidency.

EUR/USD is up around 0.4% to 1.0315 and held around 1.0300 to 1.0320 mostly, with large option expiries keeping the pair afloat above the figure level. Meanwhile, GBP/USD is up 0.2% to 1.2190 while AUD/USD is up 0.2% to 0.6200 on the day.

All eyes are on Trump’s inauguration next to see what he will announce as he takes charge of the White House again.

In other markets, Bitcoin is up as Trump also stirred up some crypto fever by launching his own meme coin. $TRUMP reached a market cap high of $14 billion before falling back to just under $11 billion currently. Still, it launched Bitcoin to a fresh record high just above $109,000 before easing back a little below the December high.

This article was written by Justin Low at www.forexlive.com.