Market Overview: Dollar Weakens Against Major Currencies
The US dollar faced declines on Monday against major currencies, including the yen and euro, as uncertainty surrounding President Donald Trump’s policies continued to impact market sentiment.
It dropped to a record low of 28.8150 against the Taiwan Dollar, raising speculation that Taiwan might be deliberately strengthening its currency as part of trade negotiations with the US. Trump appears hesitant to intervene, at least not in response to a substantial influx of capital.
In a recent interview, Trump reiterated his tariff-heavy approach, claiming that US import duties would ultimately benefit Americans. He also announced a new 100% tariff on films produced outside the US.
Juan Perez, trading director at Monex USA in Washington, noted that Trump’s unyielding stance on tariffs is a key influence on market dynamics. The dollar fell 0.79% against the Japanese yen, reaching 143.805, and declined 0.57% against the Swiss Franc, settling at 0.822.
While Trump stated he would retain Federal Reserve Chairman Jerome Powell, he frequently described Powell as “stricken.” The Fed meeting scheduled for Wednesday is anticipated to maintain stable rates following a strong March employment report.
Perez indicated that the dollar suffers most from market disruptions. “I think we’re experiencing a rather sour atmosphere today,” he mentioned, adding that there’s a sense you might not be able to rely on the American market as before.
Currently, the outlook suggests a 37% probability of a Fed rate cut in June, down from 64% last month. Notably, Goldman Sachs and Barclays have shifted their expectations for such cuts from June to July.
The dollar briefly reduced losses against the yen after a report from the Supply Management Institute highlighted notable growth in the US services sector, which constitutes about two-thirds of the economy.
In the onshore Chinese market, the Yuan achieved its best position in nearly six months, closing at 7.1831 per dollar. There’s speculation that the currency could strengthen amid ongoing trade talks with the US, with last trading noted at $7.194.
In Europe, the euro increased by 0.27% to $1.133,025, while the pound rose by 0.28% to $1.33050. The Bank of England is set to meet on Thursday, with expectations of a reduction to 4.25%, alongside Norway and Sweden’s central banks, which are also expected to stabilize prices.
