Dollar Sinks Amid Inflation Concerns and Global Economic Uncertainty

The U.S. dollar took a hit on Friday, reflecting investor skepticism over the rate outlook as inflation concerns linger. The yen emerged stronger following Japan's unexpectedly robust economic growth data, showcasing resilience amid U.S. tariffs.

Attention will be focused on a meeting in Alaska between President Donald Trump and Russia's Vladimir Putin. Observers remain skeptical about reaching a ceasefire in Ukraine but are keenly watching U.S. import price data for further inflation indicators. A sharp rise in last month's U.S. producer prices has already strengthened the dollar.

Import price hikes may suggest U.S. companies might fully absorb tariffs, leading to increased consumer costs or shrinking profits. Market odds now reflect a 95% probability of a Fed rate cut in September. All eyes are on the Jackson Hole symposium for insights into the Fed's future policies.

(With inputs from agencies.)