Dollar Dances: Global Currencies Reel Amid Tariff Talks and Rate Cuts

The dollar is maintaining its upward momentum for the fourth consecutive week against currencies like the yen and the euro. This was partly fueled by a temporary trade truce between the U.S. and China, although disappointing U.S. economic data led to fluctuations later in the week.

Weak economic indicators have raised expectations for a rate cut by the U.S. Federal Reserve, leading to declining Treasury yields. Analysts believe continued dovish sentiments might trigger a fresh bout of dollar short-selling, impacting its movements on the global stage.

With fiscal policy taking center stage, as tariff concerns ease, Republicans face challenges in implementing measures amidst Democratic opposition. Meanwhile, currency markets are eyeing negotiations between Washington and Tokyo, as foreign exchange discussions may influence the dollar's performance, particularly against the won.

(With inputs from agencies.)