The dollar index (DXY00) today is down by -0.20% and is just above last Friday's 3-year low. The dollar is posting moderate losses today as a stock rebound has curbed liquidity demand for the dollar. The dollar is also facing a confidence crisis as the US renegotiates its relationships with its trading partners, diminishing its reserve-currency status and prompting some foreign investors to liquidate their dollar assets. The dollar did find some support today on a slight easing of tariff tensions after President Trump excluded most consumer electronics from reciprocal tariffs.
The markets are discounting the chances at 23% for a -25 bp rate cut after the May 6-7 FOMC meeting, down from a 30% chance last week.
