The US Dollar continues to lose ground to other major currencies, having lost more than 1.4% against the Euro so far this month. The Greenback depreciation can be explained mainly by concerns over the escalation of trade tensions between the US and China and how the Federal Reserve may react; it is increasingly likely that the next movement will be a cut, which may arrive as early as July.
Many observers point to the fact that pressure is building up and the Fed may have no alternative but to cut rates, amidst a perfect storm of heightened trade tensions, a weak jobs report, anaemic inflation and political pressure from President Trump. In the meantime, the markets are pricing it all in and that is why the US Dollar is likely to continue on the current downwards trend.
