U.S. Dollar Weakens to Six-Week Low Amid Trade War Concerns

The U.S. dollar index slumped to 98.58, its lowest level since late April, as trade tensions continue to weigh on investor sentiment. The euro edged up to $1.1446, while the dollar hovered NEAR a one-week low against the yen at 142.71. Market participants await factory production and jobs data to gauge the economic impact of escalating tariffs.

Steel and aluminum duties will double to 50% this week, intensifying pressure on global trade negotiations. "Trade tensions aren’t improving, and we’ve seen the dollar getting hammered widely," said Rodrigo Catril of National Australia Bank. Antipodean currencies showed resilience, with the New Zealand dollar climbing to $0.6045 - a 2025 high.

Attention now turns to the ECB’s upcoming rate decision and forward guidance. The dollar’s decline coincides with growing concerns over U.S. debt sustainability, triggering what some analysts call a ’Sell America’ trend in currency markets.