FX.co ★ Dollar Holds Advance on Trade Deal Boost

The US dollar index maintained its strength above 98.6 on Tuesday, following a 1% ascent in the previous session. This was primarily due to the euro's weakness in response to a newly established US-EU trade agreement, which is perceived to advantage the US economy. The agreement introduces a primary 15% tariff on EU goods, a move that has elicited significant criticism from European leaders. France has labeled the agreement as unbalanced, while German Chancellor Merz has cautioned that it might severely impact the German economy. President Trump reiterated on Monday that nations opting out of negotiating separate trade deals might face tariffs ranging from 15% to 20%, notably higher than the 10% rate instituted in April. Meanwhile, the Federal Reserve is anticipated to maintain interest rates at the upcoming policy meeting on Wednesday, although market watchers are keenly observing for any indications of a potential rate reduction in September. Additionally, investors are focused on crucial economic data releases this week, including the PCE inflation report and nonfarm payroll figures, to gain further insights into the condition of the US economy.