Dollar slips as trade uncertainty lingers

The U.S. dollar started the week on a weaker note, weighed down by fresh uncertainty surrounding global trade policy.

Investors remained cautious amid concerns that new levies could dampen US economic growth.

In this regard, markets could remain focused on new economic data. The release of GDP growth data later this week could affect sentiment as traders reassess the trajectory of the economy and the potential impact of tariffs, in particular after the Federal Reserve revised its projections down.

Softer data could reignite growth concerns and reinforce downside risks for the currency in the short term, while stronger-than-expected figures could help the dollar rebound.

Meanwhile, US treasury yields could extend their gains as investors move toward safer assets. Yields could also continue to react to changing market expectations regarding monetary policy direction and the anticipated pace of interest rate cuts.