A decrease of the indicator value may contribute to the fall in quotes of USD.
A decrease of the indicator value may contribute to the fall in quotes of USD.
Traders are predicting five interest rate cuts by the Federal Reserve (Fed) before the end of the year, Bloomberg reports. Such expectations have been formed due to the aggressive tariff measures introduced by the Trump administration.
Goldman Sachs now expects the US GDP to rise only 0.5% in the period from the fourth quarter of 2024 to the fourth quarter of 2025. Besides, the analysts raised the probability of a 12-month recession in the country from 35% to 45%.
US Treasury Secretary Scott Bessant downplayed concerns about a recession and market fluctuations, asserting that President Donald Trump's policies are strengthening the nation's long-term economic outlook.
Overall US inflation probably slowed slightly last month. The US Bureau of Labor Statistics is forecasting that the nation's consumer price index rose 0.1% in March. That would be the smallest increase since July.
An increase of the indicator value may contribute to the fall in quotes of USD.
An increase of the indicator value may contribute to the rise in quotes of USD.
Bloomberg notes Wall Street is divided over the Federal Reserve's (Fed) future steps amid President Trump's escalating trade policies. Nevertheless, all experts agree on the threat of stagflation.
JPMorgan's Head of Economic Research Bruce Kasman expressed concern about a significant increase in the likelihood of a global recession to 60% this year. In his opinion, the tariffs imposed by the Trump administration represent the largest tax burden for American households and companies.
The Federal Reserve Bank of Dallas has issued a warning about a significant decline in Texas's economic outlook. As the largest trading state in the US, Texas is grappling with concerns stemming from Trump’s tariff policies, which have caused businesses to worry about rising production costs.
After Donald Trump's announcement of new tariffs, Bloomberg conducted a poll among 54 analysts on April 2–3. An overwhelming majority (about 92%) believe that the new measures of the US administration increase the risks for economic growth in the country in the next 12 months.
The dollar is the monetary unit of the United States (US). It is also used as the official currency by some other countries (Ecuador, Zimbabwe, El Salvador). The dollar holds a leading position in the world economy.
At the moment, the dollar dominates the system of international settlements with almost 50% share (the euro ranks second with less than 25%). Meanwhile, the dollar's dominance is even more pronounced in the financial sector, on the foreign exchange market, and in the government reserves.
The US currency (USD) quotes, as well as those of its foreign counterparts, depend primarily on the economic and political situation in the issuing country. The US authorities, such as the Federal Reserve System (the Fed) and the Department of the Treasury, influence the dollar exchange rate by changing their monetary, fiscal, budget, and tax policies.
Moreover, the value of the dollar may be significantly affected by the latest news and the international situation. Global economic problems and rising geopolitical tensions have historically been favorable for the US currency, as investors consider it one of the major safe-haven assets, along with gold. In contrast, during periods of strong economic growth and a relatively calm global environment, the demand for the dollar tend to reduce.