The US Dollar edged higher but remained relatively unchanged this week.
Escalating trade tensions between the US, Europe and Canada weighed on market sentiment, prompting investors to seek refuge in safe-haven assets.
Following Wednesday’s European countermeasures on US tariffs, President Donald Trump responded by threatening a 200% tariff on alcoholic beverages from the EU.
While market uncertainty could benefit the greenback, recession fears could potentially weigh on the currency.
Meanwhile, US treasury yields rose, with the 10-year note nearing the 4.3% mark. The Federal Reserve’s rate decision next week is expected to play a critical role in the bond market, with a dovish stance likely to push yields lower while a hawkish outlook could provide support for the dollar and yields.
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