Rabobank's analysts note that the U.S. President Donald Trump has this month stepped up his verbal intervention in the FX market.

• “In a step away from his now familiar outbursts against the policy of the Federal Reserve he has accused Europe in addition to China for playing a “big currency manipulation game and pumping money into their system in order to compete with the USA”.
• The accusation comes a day or so after the President nominated two doves to fill vacant board positions at the Federal Reserve.  Trump’s wrath regarding USD strength coincided with the release of a larger than forecast US trade deficit for May.
• Although it would be highly unusual for a US government to attempt further measures to weaken the USD, it is not beyond the realms of possibility that the Trump administration will try.  This, however, could bring some unwanted long term effects for the US.”