FX.co ★ Dollar Slips as Traders Eye Fed Signals, US-China Trade Talks

The US dollar index declined to approximately 99.6 on Thursday, undoing the gains recorded in the prior session. This shift came as financial markets processed the Federal Reserve's recent policy decisions and anticipated impending high-level trade negotiations between the United States and China. In line with expectations, the Federal Reserve maintained steady interest rates. Nevertheless, Chair Jerome Powell adopted a cautious perspective, highlighting elevated risks to inflation and unemployment rates. He firmly dismissed the idea of a preemptive rate reduction to counter any potential economic repercussions from President Donald Trump's proposed tariff measures. Regarding trade discussions, Treasury Secretary Scott Bessent and U.S. Trade Representative Jamieson Greer are slated to meet with Chinese officials in Switzerland over the weekend to address trade issues. However, President Trump declared that he would not consider reducing tariffs as a condition for initiating discussions. Consequently, the dollar experienced a broad decline, with the most significant losses observed against the British pound, Australian dollar, and New Zealand dollar.