The dollar index is trading near its highs in 2024

The dollar is trading near its best levels of the year with an annual gain of 7% as traders were not too excited to make any big moves, and we expect this week and next week to continue quietly without any big important data, so traders can enjoy this calm, and the US currency is preparing for Trump's agenda, which is America First, where tax cuts and comprehensive deregulation can ignite inflationary pressures again.

Trump and his team of billionaires and businessmen are ready to charge the economy even if inflation rises again and raises the risk of rising interest rates.

Regarding this dynamic, more fiscal spending from the government may lead to higher consumer prices, which threatens to release inflation into the bottle, as inflation is still above the Fed's target of 2%, where the November rate was 2.7%.

The Fed has also said that if inflation rises, it may pull back from its guidance on cutting interest rates.

The median forecast of the Federal Open Market Committee indicated a 50 basis point cut in interest rates for next year, which suggests that interest rates will remain at much higher levels than previously expected.