The dollar index (DXY00) Monday fell by -0.57% and posted a 3-1/4 year low. The dollar fell on the last day of Q2 and remains under pressure due to uncertainties over US trade policies with many nations trying to negotiate trade deals with the US before President Trump's July 9 deadline. Also, rising deficits are bearish for the dollar as the Congressional Budget Office estimates the measure would add nearly $3.3 trillion to US deficits over the next ten years. The dollar extended its losses after the June MNI Chicago PMI unexpectedly contracted by the most in 5 months.
On the positive side for the dollar are signs of progress in trade negotiations with China and the EU. Also, trade talks are back on with Canada after it withdrew a digital services tax. In addition, Indian and Japanese trade negotiators extended their stay in the US this week to iron out trade deals.
