Written by Steven Dooley, Head of Market Insights, and Shier Lee Lim, Lead FX and Macro Strategist
Dollar consolidates as markets weigh Trump tariff comments
The greenback traded mixed against major currencies as markets digested US President Trump’s comments on potential tariffs and mixed US employment data.
USD held below the 104.00 level on DXY Index, with momentum suggesting continued range-bound trading ahead of this week’s US inflation data.
The euro approached 1.0900 before softening towards 1.0840 during NY trading, with strong technical resistance limiting upside potential.
Asian currencies showed limited movement, with USD/JPY flat, USD/SGD weakened 0.2%, while USD/CNH gained a modest 0.1%.
US equities finished positive with the S&P 500 rising 0.55% to 5770 and Nasdaq gaining 0.70% to nearly 18200, as Fed Chair Powell maintained an optimistic economic outlook despite the mixed employment report.
Market participants will be watching for this week’s meeting between US and Ukrainian officials in Saudi Arabia.
Economic data to drive Dollar direction
The US dollar will be in focus this week with key inflation data scheduled for release, which could influence Federal Reserve policy expectations.
Consumer Price Index (CPI) data is due on Wednesday, which will be closely watched by market participants for signs of inflation trends. This will be followed by Producer Price Index (PPI) figures on Thursday.
The Job Openings and Labor Turnover Survey (JOLTS) report on Wednesday will provide insight into the US labor market conditions, potentially affecting dollar sentiment.
In Europe, industrial production data is scheduled for release on Friday, which may impact the euro.
The Bank of Canada will make its rate announcement on Thursday, likely influencing CAD movements against major currencies.
Several Asian economies will release important data, with Japanese GDP figures due on Monday.
The UK will publish monthly GDP and industrial production numbers on Friday, which could drive GBP volatility to close the week.
Aussie left behind as commodities gain on tariff worries
The AUD/USD was weaker on Friday even as commodities made further gains with the Aussie’s relationship with the commodity complex continuing to wax and wane in recent months.
The Aussie remains broadly flat in 2025 despite a more than 18% rally in the World Commodity Index since forming a bottom in September last year. The World Commodity Index is up 7.0% in 2025.
Notably, the AUD/USD’s rolling one-month correlation, at -0.105, signals an almost complete lack of relationship between the Aussie and the commodity space. (A reading of 1.0 signals perfect correlation while a reading of -1.0 signals a perfect negative correlation. A reading of zero shows no correlation.)
For now, markets are still being driven by tariff news, with commodities in demand as businesses try to front-run tariffs. For example, US lumber prices are at 30-month highs and copper at 10-months highs with threats of tariffs on both commodities driving activity.
However, this demand might not last and worries about flagging demand could be the driver of a weaker Australian dollar, with the AUD/USD still in a clear long-term downtrend, as signalled by the downward pointing 200-day moving average.
Aussie retreats as China CPI contracts
Table: seven-day rolling currency trends and trading ranges
Key global risk events
Calendar: 10 – 14 March
All times AEDT
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*The FX rates published are provided by Convera’s Market Insights team for research purposes only. The rates have a unique source and may not align to any live exchange rates quoted on other sites. They are not an indication of actual buy/sell rates, or a financial offer.