Last week was packed with central bank rate decisions, with most major central banks expressing concerns over global trade uncertainty and inflation trends. Many opted to keep rates unchanged, adopting a more cautious stance amid ongoing uncertainties.
This week, in addition to a series of key inflation-related data releases, markets will closely watch developments in Trump’s trade policy and the ongoing Russia-Ukraine peace talks.US, Ukraine Hold Talks in Saudi Arabia
U.S. and Ukraine Hold Talks in Saudi Arabia
On Sunday, U.S. and Ukrainian delegations met to discuss proposals for protecting energy infrastructure and critical facilities as part of a broader diplomatic push led by U.S. President Trump to end the three-year-long war.
The meeting in Saudi Arabia, which precedes Monday’s U.S.-Russia talks, comes as the U.S. special envoy expressed optimism about a potential resolution to the conflict.
The U.S. aims to secure a broader ceasefire deal by mid-April, though European leaders remain skeptical. Ukraine insists that Russia must fully halt attacks before meaningful negotiations can take place. Meanwhile, despite a temporary pause in strikes on energy facilities, Russian attacks on Ukraine continue.
Markets Await Clarity on Trump’s Tariff Policy
The U.S. dollar has been under pressure over the past two months as markets factor in concerns that Trump’s trade policies could trigger a potential U.S. recession.
Last week, the dollar saw mild upside, supported by cooling market sentiment and a slightly dovish tone from the Federal Reserve. However, it remains below multi-month lows, reflecting ongoing uncertainty.
While a short-term recovery in the dollar is possible, a new round of reciprocal tariffs, set to be announced on April 2, has raised concerns over escalating global trade tensions. As more tariffs are introduced, the dollar’s upside may remain limited.
Market Reaction: US Dollar Short-term Rebound
The US Dollar saw a short-term rebound last week, holding steady near its multi-month low around 103.50.
(US Dollar Index, 4-H Chart; Source: Ultima Markets MT4)
From a technical perspective, the US Dollar Index (DXY) has shown signs of recovery above the 103.50 level. With markets awaiting further clarity on Trump’s tariff policy in early April, there is potential for a short-term rebound in the US Dollar in the near term.
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