Dollar May Fall Today
The US dollar (USD) found firmer ground early in the week and received some relief in late European trading hours from President Trump’s claim that tariffs on Canada and Mexico would continue. The 25% tariffs were delayed for a month in early February, and Monday, March 3, is the new deadline to avoid a USMCA trade war, ING FX analyst Francesco Pesole notes.
“We wouldn’t be surprised to see Trump ratchet up tariff threats until the last minute to gain leverage, as he did in February. Our working assumption remains that 25% tariffs on Mexico and Canada will not materialize, and the market is pricing in only a small risk of that happening. We could see FX taking the threat more seriously throughout the week, with USD/CAD and USD/MXN facing near-term upside risks.”
"On the data front, expect a fair amount of attention on the Conference Board's consumer confidence today. The index surged in November after the US election but fell in December and January. Consensus is looking for a further slowdown to 102.5 from 104.1, with 100 potentially being a painful level for market reaction.
Source: FXStreet
