Dollar's Roller Coaster Ride: From Relief to Retreat

The dollar's brief rally waned on Thursday despite an initial surge following a court ruling against President Trump's broad import tariffs. The greenback's earlier rise lost momentum as market focus returned to uncertainties over trade relations and the U.S. fiscal outlook. It rose just 0.1% against the yen and consolidated gains versus other major currencies.

Experts warn that while reciprocal tariffs are halted, Trump could still pursue targeted trade actions, compounding uncertainty. Kenneth Broux of Societe Generale stressed this ruling might not significantly alter the medium-term economic landscape, with the potential for prolonged tariff concerns impacting global trade activities.

In the broader market, U.S. Treasuries faced sell-offs, while global equities experienced mixed responses. Investors watched closely for developments in U.S.-EU trade talks, further influencing financial markets. Additionally, expectations for Federal Reserve interest rate cuts were adjusted amid shifting economic conditions.

(With inputs from agencies.)