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Home Investing in Forex US Dollar Slides as Trade Optimism Boosts Euro and Pound

US Dollar Slides as Trade Optimism Boosts Euro and Pound

by Barbara

The US Dollar Index (DXY) fell to a five-week low on Monday, dropping below the 99.00 support level. This decline followed uncertainty over the White House’s inconsistent trade policies.

Investors will focus on several key reports today, including the Conference Board’s Consumer Confidence, Durable Goods Orders, the FHFA House Price Index, and the Dallas Fed Manufacturing Index. Additionally, Federal Reserve official Kashkari is scheduled to speak.

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The euro rose above 1.1400 against the dollar, reaching multi-week highs amid renewed optimism about trade. Germany will release its GfK Consumer Confidence data, while the Eurozone will publish Economic Sentiment, the final Consumer Confidence reading, and Consumer Inflation Expectations.

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The British pound climbed to its highest level in over three years, nearing the 1.3600 mark against the dollar. This gain comes as the US dollar weakens further. The only economic data from the UK today is the CBI Distributive Trades survey.

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The US dollar gave up some losses against the Japanese yen after hitting monthly lows near 142.20. It ended Monday with modest gains, partially reversing recent declines. Japan will release its weekly Foreign Bond Investment data and May Consumer Confidence figures on May 29.

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The Australian dollar climbed above 0.6500 on Monday, reaching levels last seen in late November 2024, before easing slightly. Australia will report its Monthly CPI Indicator and Construction Work Done on May 28.

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Oil prices continued to fall, with WTI crude nearing $61 per barrel. This drop occurred despite improved trade sentiment following President Trump’s softened stance on tariffs with the European Union.

Gold prices pulled back from a strong rally on Friday, trading near $3,320 per troy ounce after reports that President Trump extended the deadline for trade talks with the EU. Silver also started the week slowly, facing selling pressure near $33 per ounce.

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