Dollar Index Edges Up Amidst Trade Deal Uncertainty

(RTTNews) - The U.S. dollar recorded a mixed performance against major currencies during the week ended April 25 amidst continuing uncertainty in respect of U.S. trade policy and oscillating expectations about a trade deal, particularly with China. The greenback gained against the euro and the Japanese yen but slipped against the British pound and the Australian dollar. The Dollar Index recorded mild gains in a week that also saw a toning down in the harsh rhetoric that intensified the global trade war.

The Dollar Index, a measure of the Dollar's strength against a basket of currencies comprising the euro, the British pound, the Japanese yen, the Canadian dollar, the Swedish krona and the Swiss franc closed trading on April 25 at 99.47, edging up 0.09 percent from the level of 99.38 recorded a week earlier. The week's trading range was much wider, oscillating between the low of 97.92 recorded on Monday and the high of 99.94 recorded on Wednesday.

The Euro slipped 0.24 percent against the Dollar in the week that saw the ECB cut all three of its key interest rates by 25 basis points as expected. During the week ended April 25, the EUR/USD pair declined to 1.1364, from 1.1391 a week earlier. The pair ranged between $1.1574 and $1.1308 during the week.

The sterling added 0.15 percent against the greenback during the week ended April 25 amidst hopes of a U.S.-U.K. trade deal and the dollar's weakness. The GBP/USD pair rose to 1.3314 on April 25 from 1.3294 a week earlier. The sterling's weekly trading range was between $1.3426 recorded on Tuesday and $1.3232 recorded on Wednesday. Data released during the week had showed an expected decline in manufacturing PMI, a larger-than-expected decline in services PMI and an unexpected gain in retail sales.

The Australian Dollar rallied 0.27 percent against the greenback during the week ended April 25. From the level of 0.6376 recorded on April 18, the AUD/USD pair rallied to 0.6393 in a week's time amidst the uncertain global trade scenario and the lingering trade tensions between China and the U.S. The pair which had touched a high of 0.6441 on Tuesday dropped to touch the week's low of 0.6343 on Thursday.

The USD/JPY pair jumped 1.06 percent during the week ended April 25 as it closed at 143.67 versus 142.17 a week earlier. Expectations that the trade related global uncertainty would goad Bank of Japan to delay its interest rate hikes contributed to the yen's weakness. The pair ranged between the low of 139.88 recorded on Tuesday and the high of 144.05 recorded on Friday.

In addition to trade tariff related headlines, on the horizon for currency markets are key economic data updates from the U.S. that could portend the extent of Dollar's potential resilience. This includes job openings data on Tuesday, GDP and PCE-based inflation readings on Wednesday, Manufacturing PMI update on Thursday and the monthly payrolls data on Friday. Amidst the persisting uncertainty in the global trade tariff environment, the Dollar Index or DXY is currently trading at 99.26 versus 99.01 at close on Monday and 99.47 at close on Friday.

Ahead of the GDP and inflation updates from the Euro region, the EUR/USD pair has increased to 1.1399 versus 1.1364 at close on Friday. The GBP/USD pair is at 1.3401. The pair had closed trading at 1.3314 at the end of the previous week.

Markets expect Bank of Japan to stay pat on rates at its interest rate review scheduled for Thursday. In anticipation of the expected move, the USD/JPY pair is currently at 142.18, decreasing from the level of 143.67 recorded at the close of the previous week.

Ahead of the release of crucial trade data due from Australia on Wednesday, the AUD/USD pair has decreased to 0.6388 from 0.6393 at close on Friday.