The US Dollar (USD) is mixed to weaker in what is a difficult start to the week for the markets. Stocks are trading significantly lower following the emergence of a Chinese AI startup — DeepSeek — that could challenge US dominance in the field (and take some momentum away from tech valuations). US stock futures reflect a decline of nearly 4.1% on the Nasdaq 100, with the S&P 500 down 2.3%. Both are trading above early lows, notes Shaun Osborne, Chief FX Strategist at Scotiabank.
USD loses ground against havens
“European markets are lower, but losses are less severe. Bonds are on sale and part of the USD’s decline can be explained by the sharp drop in bond yields — 10-year bond yields. The US is down 12 basis points on the session, while European 10-year government bond yields are down 5-7 basis points. Haven demand has spread to the FX, with the JPY up one. 1.3% and the CHF gaining 0.9% on the session.”
“USD’s losses today add to the decline seen over the past two weeks as President Trump’s broad and severe tariff threats recede — to some extent. The DXY appears poised to extend near-term losses and return to test the late November/early December levels for the DXY in the low 106s.”
“The focus will shift to interest rate policy later this week, with the Fed likely keeping rates steady amid slow progress in inflation, resilient growth and the FOMC likely wanting time to assess the potential impact of the administration’s new policy priorities. Stable rates may provoke a response from the president, who has made clear that he believes rates should be lower.”
Source: Fx Street
I am Joshua Winder, a senior-level journalist and editor at World Stock Market. I specialize in covering news related to the stock market and economic trends. With more than 8 years of experience in this field, I have become an expert in financial reporting.
