During today's Asian trading, the US dollar consolidated against major currencies, as traders awaited details on President Donald Trump's tariff plans, which could influence markets in the near term.
The US Dollar Currency Index (DXY), which tracks the dynamics of the dollar against six currencies (euro, swiss franc, yen, canadian dollar, pound sterling and swedish krona) rose by 0.02% to 104.24. Trump has labeled April 2 as "Liberation Day," and White House spokeswoman Karoline Leavitt confirmed that reciprocal tariffs on countries imposing duties on U.S. goods would take effect immediately. Market sentiment remains cautious, with traders closely watching for further tariff-related headlines that could drive currency movements.
The dollar fell 0.15% against the yen, while the Australian and New Zealand dollars also rebounded, gaining 0.9% and 0.85%, respectively. The Washington Post reported that Trump's team is considering a blanket 20% tariff increase on most imported goods rather than targeting specific nations or products. While such tariffs might theoretically support the U.S. dollar, markets are more concerned about their potential to exacerbate stagflation risks. Recent weak U.S. economic data has fueled recession fears, weighing on the dollar, which fell 3.1% in March - its worst performance since November 2022. U.S. manufacturing contracted in March, and factory-gate inflation surged to a three-year high, driven by import concerns. Wells Fargo economists attributed price increases to preemptive tariff adjustments, warning of reduced demand due to uncertainty.