Source: Bloomberg

The dollar began selling off late morning New York time as news came across the ticker that President Trump would release the House Republicans’ memorandum about alleged FBI political interference. As the chart shows, the US long bond rallied after the dollar weakened.

The memo — you can read it in full here — is political dynamite, and entirely without precedent in American political history: the House Republicans claim that the FBI used the now-infamous Steele Memorandum to obtain a FISA warrant and wiretap Trump campaign volunteer Carter Page, noting that the Steele dossier was paid for by the Democratic National Committee and the Clinton campaign. If that wasn’t bad enough, this occurred in October 2016, just before the elections. A month earlier Steele had leaked his memo to Yahoo news and other outlets, which should have disqualified him as a source.

The memorandum looks devastating; it provides strong grounds to believe that the US counterintelligence service was involved in political dirty tricks during a presidential campaign. That’s way, way worse than Watergate, when the FBI and CIA refused to get involved in dirty business.

First impression is that this should be dollar positive: It’s a triumph for Trump and casts serious aspersions on the motives of his detractors.

Asia Times Financial is now live. Linking accurate news, insightful analysis and local knowledge with the ATF China Bond 50 Index, the world's first benchmark cross sector Chinese Bond Indices. Read ATF now.