FX.co ★ Dollar Slips Amid Risk-On Rally

The US dollar index experienced a decline to approximately 97.3 on Thursday, marking its second day of losses as investors showed a preference for riskier assets amid a widespread rally in stocks and commodities. The dollar faced additional pressure from a significant drop in Treasury yields, which was influenced by strong demand in Wednesday’s 10-year note auction. Regarding monetary policy, the minutes from the latest Federal Reserve meeting indicated that the majority of officials were open to the possibility of interest rate cuts later this year. Despite the overall decrease, the dollar rose over 2% against the Brazilian real following President Donald Trump’s announcement of a 50% tariff on Brazilian imports due to what he described as an “unfair trade relationship.” Furthermore, Trump issued tariff notifications to eight other countries, including the Philippines, Brunei, Moldova, Algeria, Iraq, Libya, and Sri Lanka, with duties set between 25% and 30%, effective August 1. Investors are now focusing on potential trade agreements with India and the European Union.