28.04.202514:25:29UTC+00Dollar Eases as Traders Brace for Busy Week

On Monday, the dollar index declined to 99.5, reversing some of the gains seen last week. Traders are now preparing for a barrage of data likely to illustrate the initial impacts of President Trump's tariffs. The PCE report for March is anticipated to show headline inflation at approximately 2.2% on a year-over-year basis, with core prices rising by a mere 0.1% month-over-month. This represents the weakest core reading since March 2021 and strengthens the argument for the Federal Reserve to pause its rate hikes or even consider rate cuts by the middle of 2025. Meanwhile, preliminary tariff reprieves between the U.S. and China—comprising select exemptions without a formal agreement—have diminished the dollar's appeal as a safe-haven currency. As the markets await this week's crucial data, including April's employment figures, first-quarter GDP data, and the Fed's preferred inflation measure, any negative surprises could reinforce expectations for early Federal Reserve easing. The dollar, which found support last week due to President Trump's suggestion of softer Chinese tariffs and his shift away from threatening Federal Reserve Chair Powell, is now showing signs of weakening.