Dollar Steady, Markets Await Clarity on Fed Policy
The dollar index held steady around 98.8 on Wednesday (August 6th), remaining virtually unchanged throughout the week. Market participants are assessing the Federal Reserve's policy direction amid mixed economic data and renewed trade tensions.
The latest data from the International Monetary Fund (ISM) showed that US service sector activity nearly stalled in July, weaker than expected. This demonstrates the real impact of President Donald Trump's trade tariffs on the US economy.
Meanwhile, Trump said he would announce a nominee to fill the vacancy on the Fed's Board of Governors later this week. He also revealed that the list of candidates to replace Chairman Jerome Powell has been narrowed. The market currently prices a more than 90% chance of a Fed rate cut in September, with a total easing of around 60 basis points by the end of the year.
On the trade front, Trump has again rattled markets with new tariff threats. He has threatened to impose duties of up to 250% on imported pharmaceutical products, as well as the possibility of additional tariffs on semiconductors. This has raised market concerns about the uncertainty of future US trade policy. (ayu)
Source: Newsmaker.id
