FX.co ★ DXY Pares Losses, Heads for 2nd Week of Gains

The US dollar index trimmed its earlier losses to hover around 100 on Friday, gearing up for a second consecutive weekly rise. This movement followed a recent employment report that pointed to a labor market that is gradually cooling yet remains robust. Surpassing forecasts, the report provided the initial glimpse into employment dynamics since President Donald Trump announced expansive tariffs. Bond markets have already factored in apprehensions that these trade policies could dampen economic growth, thereby intensifying calls for the Federal Reserve to reduce interest rates. Market participants continue to anticipate nearly four interest rate cuts from the Fed this year. Additionally, sentiment improved with news that China is contemplating the resumption of trade negotiations with the United States. Chinese authorities emphasized that the US needs to demonstrate sincerity by rescinding all unilateral tariffs. They asserted that if the US is inclined to engage in talks, it must rectify its erroneous actions and revoke the unilateral tariffs.