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The US dollar remained stable on Wednesday as weak US consumer confidence data and concerns over the economic impact of upcoming US tariffs dampened recent gains. Meanwhile, the British pound fell as UK inflation eased and markets anticipated interest rate cuts from the Bank of England (BoE).
Key Market Moves:
- USD/JPY: The dollar rebounded above 150 yen, trading at 150.20 amid cautious sentiment ahead of new US trade tariffs.
- EUR/USD: The euro slipped to $1.0776, a three-week low, extending losses from its five-month high.
- GBP/USD: Sterling dropped 0.4% to $1.2890 after UK inflation slowed to 2.8 percent in February from 3.0 percent in January, reinforcing rate-cut expectations.
Focus on US Tariffs and Economic Growth
Markets remain on edge as President Donald Trump is expected to announce new tariffs next week, potentially targeting:
- Autos
- Semiconductors
- Pharmaceuticals
Despite traditional expectations that tariffs fuel inflation and strengthen the US dollar, concerns over slower economic growth are driving counterintuitive currency movements.
Emerging Market Highlights:
- The Russian rouble rose 0.5 percent to 84.20 after US-Russia agreements to pause attacks on energy targets, easing geopolitical risks.
- The Turkish lira steadied below 38 per dollar, following reassurances from Turkey’s finance minister and central bank governor.
- The Indonesian rupiah hovered near a record low amid concerns over rising government spending and slowing growth.
As global markets brace for upcoming US trade measures, investors will closely watch monetary policy shifts in the UK and beyond.
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