Even though nothing startlingly new was announced during Trump’s speech before the US Congress on Tuesday, promises related to spending, tax reform, trade, and healthcare were enough to spur additional optimism in the dollar overnight. Although the US currency faced renewed pressure after the second estimate of US gross domestic product for the fourth quarter came in below the consensus estimate, confidence figures reported by the Confidence Board showed that the US consumers are the most optimistic since 2001.
Corroborating this idea was the consumer component of GDP which helped offset weaker government expenditures and business investment. Helping to bolster the outlook is rising speculation that the Federal Reserve will raise rates in March, with the CME Group’s Fedwatch tool pricing 35.40% probability of a rate hike in March. In the meantime, gains in the dollar are sending USDCHF higher, with the pair briefly retaking the 1.0100 level.