Two weeks have passed since the summit between President Trump and North Korean leader Kim Jong-un in Singapore attracted the attention of the globe. The meeting that many thought would never be possible appeared to have concluded successfully after the news that President Trump convinced Kim Jong-un to sign a denuclearization agreement. Trump described the summit as “fantastic” and “better than anyone could imagine.”

This was overall viewed as a positive measure for the financial markets. The indications that Donald Trump and Kim Jong-un developed the foundations to strengthen relations between the United States and North Korea are encouraging, as it removes a layer of political risk that had lingered since the summer of 2017 and had been viewed as a major risk to investor sentiment. Both leaders were seen as “winners” from the summit, with Kim Jong-un gaining the opportunity to potentially take North Korea away from decades of global isolation and Donald Trump becoming the first sitting US president to meet a leader of North Korea.

Despite some skepticism over how “denuclearization” could actually be characterized and also what timeframe we would be looking at for North Korea to dismantle its own nuclear capabilities, there is little dispute that this is seen as positive news for the global financial markets. Away from the ongoing trade war concerns dominating recent headlines, the verbal dispute between President Trump and Kim Jong-un in the media had kept investors on their toes for the past year. If Kim Jong-un is able to drive North Korea away from the global isolation that it has found itself in for decades, he would likely define his legacy as a hero in North Korea for generations to come. The eventual denuclearization would also stand to open North Korea to international investment and access into the market.

The major asset to have gained in the aftermath of the summit has actually been the US Dollar. The Greenback has stormed to new 2018 highs in the two weeks following the Singapore summit, with the Dollar Index even touching 95 for the first time since November 2017 in this period. One of the more unusual explanations that have been provided to describe as to why the Dollar has been able to gain significantly since the summit is optimism that Trump’s unorthodox foreign policy tactics might actually be able to bring forth a positive outcome. The summit was overall seen as a major win for Donald Trump before his mid-term US elections later in 2018.

Due to the advancement in the Dollar since the Singapore summit, a number of different global currencies and commodities like Gold have suffered from USD strength since the meeting concluded. The value of Gold has dropped to its lowest level since December 2017 marginally above $1260, with the Chinese Yuan suffering a similar fate. The British Pound has also declined to its weakest level since December 2017, while the Euro has weakened to levels not since last summer.

The corresponding buying momentum in the US Dollar since the historic meeting between Trump and Kim Jong-un actually means that those currencies pegged against the Dollar are also some the biggest winners from the summit. The UAE Dirham, Saudi Riyal and Lebanese Pound are just some of the pegged currencies that will have noticed they have strengthened against their global counterparts. Expatriates in the UAE for example will notice that their earnings when sending money back to the United Kingdom, Europe or even India would have increased over the past fortnight.

As we head into the second half of 2018, the outlook for currencies pegged to the USD remains encouraging. The USD is expected to continue strengthening against its global counterparts, on a mixture of optimism over higher US interest rates and expectations that the United States economy will continue to perform significantly beyond its developed peers.

The above means that those pegged currencies to the Dollar will strengthen further against its global counterparts. The outlook for the Dirham, Saudi Riyal and Lebanese Pound look particularly encouraging against the emerging market currencies that are facing headwinds from a mixture of concerns between the prospect of higher US interest rates and anxiety of suffering the fallout from President Trump’s ongoing trade dispute with China.

Jameel Ahmad is the Global Head of Currency Strategy & Market Research at FXTM