Dollar Strengthens, Markets Await Employment Data
The US dollar edged up 0.1% on Friday morning and is on track for a weekly gain of around 2.5%—its best performance since September 2022. This gain was driven by President Donald Trump's new tariff policy, aggressive signals from the Federal Reserve, and consistently solid US economic data.
Trump signed an executive order imposing new tariffs of up to 50% on dozens of countries, effective August 7. Major industrialized nations such as the European Union, Japan, and South Korea were hit with 15% tariffs, while others, like Brazil, were hit with up to 50%. Canada was also hit with a 35% tariff on goods that did not comply with regional trade agreements.
However, the dollar's gains were limited ahead of the release of the US monthly employment report. Investors are looking for signs of an imminent interest rate cut by the Fed. Currently, the US central bank has kept interest rates unchanged for the fifth consecutive year, despite Trump's calls for easing.
Fed Chairman Jerome Powell said employment conditions remain solid and inflation is quite high. Data expected to show a slight increase in the unemployment rate from 4.1% to 4.2% is not seen as enough to shake the market. If the employment data comes out as expected, analysts expect the dollar to tend to consolidate after this week's sharp rally. (ayu)
Source: Newsmaker.id
