Dollar edges lower on tariff uncertainty; sterling remains weak
The US dollar drifted lower Wednesday amid uncertainty over President Donald Trump's plans for tariffs, while sterling fell on disappointing government borrowing data.
At 04:45 ET (09:45 GMT), the Dollar Index, which tracks the greenback against a basket of six other currencies, traded 0.1% lower to 107.755, after a slide of over 1% at the start of the week.
Dollar slips on tariffs uncertainty
The dollar remained on the backfoot as traders tried to gauge the full extent of President Donald Trump's plans for tariffs, and the potential pain the new administration plans to inflict on major trade partners.
Trump said late on Tuesday that his administration was discussing imposing a 10% tariff on goods imported from China on Feb. 1, the same day as he said Mexico and Canada would face levies of around 25%.
He also indicated that Europe would also suffer from the imposition of duties on European imports, but has refrained from enacting these tariffs despite signing a deluge of executive orders following his inauguration on Monday.
“Data will play a secondary role this week as all the attention will be on Trump’s first executive orders,” said analysts at ING, in a note. “Incidentally, the Federal Reserve is in the quiet period ahead of next Wednesday’s meeting. Expect a lot of ‘headline trading’ and short-term noise, with risks still skewed for a stronger dollar.”
Source: Investing.com
