US dollar rises after inflation data

The US dollar index rose on Wednesday following the release of consumer price data (CPI), which showed higher than expected inflationary pressures, prompting Wall Street indices to retreat from all-time highs.

This rise comes amid growing expectations that the Federal Reserve will wait before taking any step towards lowering interest rates this year.

Traders are waiting for producer price data

With price pressures mounting, markets are turning their attention to the producer price index (PPI) data, which will be released later today.

Analysts expect these data to reveal an additional increase in production costs, as a result of the recent tariffs, amid the reluctance of some companies to pass on those costs to consumers directly so far.

Customs duties and their impact on inflation

The imposition of duties on some goods led to an increase in prices, which contributed to an increase in inflation rates.

In contrast, some goods such as duty-free cars have kept their prices stable so far.

This disparity between duty-free and duty-free goods has made the market more volatile, especially amid expectations that inflation may continue to escalate over the summer.

Powell confirms: no interest rate cut at the moment

Fed Chairman Jerome Powell reiterated that tariff-related inflation is a major reason to postpone the rate cut at least during the next meeting at the end of this month.

In his remarks, he stressed that the central bank will continue to closely monitor the data before taking any future steps.

Trump attacks the Fed again

former US President Donald Trump had a completely different opinion, commenting via his truth social platform saying (consumer prices are low, lower the interest rate now!)

Trump has not hesitated to publicly criticize the Fed's policies, and even called for the resignation of Jerome Powell, raising concerns about the independence of the central bank.

Powell's term as chairman ends in May 2026, but he retains his membership in the board of governors until January 2028.

In the end, the US economy is going through a delicate moment, as the Federal Reserve Balances between containing inflation on the one hand, and not curbing economic growth on the other.

With continued volatility caused by customs policies and political pressures, the dollar and global currencies are expected to remain under the pressure of anticipation.