16 July
Dollar declines amid trade deal hopes and US employment data
The dollar edged lower on Thursday amid optimism about a US-Vietnam trade deal. This agreement has raised hopes for reaching agreements with other countries before new tariffs take effect. Meanwhile, the greenback remains under pressure, hovering near its 3.5-year low.
At the same time, market attention is focused on the upcoming US June jobs report, which could influence the Federal Reserve's interest rate decisions. After ADP's private payroll data showed the first job decline in two years, market participants adjusted their forecasts. The probability of a Fed rate cut in July has now risen to 25%.
As Charu Chanana from Saxo Bank notes, weak data might be seen not as a reason to stimulate the economy, but rather as a sign of an approaching downturn.
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