Global markets were jolted on Trump’s first day in office by a new administration fact sheet calling for federal agencies to address currency manipulation by other nations. The move comes at a time when the dollar’s strength, driven by high US interest rates and robust growth, already dominates the $7.5 trillion daily foreign exchange market. This policy shift could particularly impact nations on the Treasury’s existing monitoring list, including major economies like Japan, China, Germany, and Singapore. Westpac’s head of foreign exchange strategy, Richard Franulovich, describes the warning as “ground-breaking,” suggesting that the Trump administration and Treasury Secretary nominee Scott Bessent may apply broader criteria in labeling currency manipulators. The policy echoes earlier Trump administration plans to prevent nations from moving away from dollar usage, potentially through export controls, manipulation charges, and levies. Analysts warn this could trigger increased market volatility and force countries to allow currency appreciation against the dollar, with China facing particular vulnerability given existing trade tensions with the US.