USD drifts as tariff threat eases slightly – Scotiabank
The US Dollar (USD) is mixed to slightly lower overall as FX markets continue to consolidate. Risk appetite has perked up a little amid some signs from the White House that the April tariff announcement will be flexible, perhaps more limited in range and may not include industry-specific levies—at least not for now. It is unclear what will happen with border tariffs on Mexico and Canada, Scotiabank's Chief FX Strategist Shaun Osborne notes.
USD drifts as White House suggests flexible approach to tariffs
"The focus on a (perhaps) more limited range of reciprocal tariffs is good news for the global economy and markets, reflected in the positive start to the week for stocks, but there is a lot of unknowns around this apparent shift, which has nothing at all to do with the slump in the stock markets in the past few weeks, and the situation remains fluid. An announced trip to Greenland by a senior US delegation this week might be a distraction for the news cycle from the shifting tariff focus."
"The USD may not benefit too much until tariff risks are clearer. Price trends suggest that USD is consolidating recent losses and the longer the sideways range trade extends, the harder it may be for the USD to recover meaningfully. It stands to reason that if the White House is seeking a reset of the global trade order, a stronger USD might not be part of the solution."
"On the charts, the DXY gains remain capped in the low 104 zone and slightly softer intraday price trends suggest some risk of the index drifting back a little more in the session ahead. Support is 103.75 and—major—103.25."
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