The dollar rose to 107.1 on Tuesday as traders assessed the latest FOMC minutes and Donald Trump’s tariff threats.
Dollar edges higher after FOMC minutes
The minutes from the Fed's November 6-7 meeting indicated a cautious stance on further rate cuts, with officials signaling a preference for gradual adjustments. As expected, the minutes did not reference the recent election. Currently, there is about a 60% chance of a 25 basis point rate cut next month. Meanwhile, on his Truth Social platform, Trump announced plans to impose a 10% tariff on all Chinese imports and a 25% tariff on goods from Mexico and Canada.
Global trade concerns grow
The news initially caused market volatility and strengthened the dollar, as global trade concerns grew. However, traders later seemed to ease some of those concerns, awaiting more details on the proposed tariffs. Focus now shifts to upcoming economic data, including the PCE report and the second estimate of GDP growth, due tomorrow.
