The dollar starts the third quarter with a weak performance
US Dollar Index (DXY)
The dollar index trimmed its losses today, but it is still low and is now trading near the levels of 96.80 on the first trading day of the second half of 2025.
This comes after the US dollar recorded a decline of about 10% in the first six months of the year.
Traders are closely watching the monetary policy outlook, as Fed Chairman Jerome Powell participated in a panel discussion at the European Central Bank forum.
So what were Powell's comments during the meeting:
- The United States is in a good position.
- Ignoring tariffs, inflation is in a good position.
- We expect to see higher readings of inflation, but we are learning.
- With the strength of the US economy, we think it is wise to wait to see the effects of tariffs.
- We expect to see higher inflation readings in the summer, a large majority considers it appropriate to cut interest rates later this year.
- It depends on the latest data, especially inflation data and closely monitoring the labor market.
- We expect unexpected weakness in the labor market.
- We will hold one meeting after another, I can't say for sure whether July is too early to cut interest rates.
- I will not exclude any meeting, but we will rely on the data.
- The majority of Fed officials believe that it is likely appropriate to cut interest rates later this year.
- I would say that US policy is somewhat restrictive, growth is strong, the labor market is strong.
- In response to Trump's criticism of him, Powell said that I am very focused on doing my job 100%.
