The US dollar extended its losses as growing concerns over economic stability weighed on investor sentiment.
The ongoing uncertainty surrounding President Trump’s trade tariffs continues to cast a shadow over the economy, which has been displaying hints of a slowdown, particularly in the labour market.
These concerns were further compounded by this weekend’s interview with the US President, who did not rule out the possibility of a recession this year.
As a result, investors are seeking safety in alternative assets such as the Japanese yen and Swiss franc.
The dollar could also remain exposed to geopolitical developments in Europe. Any progress toward a ceasefire in Ukraine could weigh on the greenback, while setbacks may provide temporary support.
Meanwhile, US treasury yields fell, reflecting market expectations of interest rate cuts. Forecasts point to a cut in June. In this regard, if this week’s CPI and PPI numbers show slowing inflation, the dollar and yields could be under additional pressure.
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