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The U.S. dollar index fluctuates at high levels as the market awaits Trump’s speech and non-farm payrolls data
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Hello everyone, today XM Forex will bring you "[XM Forex]: The U.S. dollar index fluctuates at high levels, and the market is waiting for Trump's speech and non-farm employment data." Hope this helps you! The original content is as follows:
In Asian trading on Thursday, the U.S. dollar index continued to hover above 99. The U.S. dollar fell against major currencies such as the Swiss franc and the euro for the second consecutive trading day on Wednesday as signs of a possible ceasefire in the Middle East conflict increased and market demand for safe-haven assets weakened. U.S. President Donald Trump said the U.S. will soon end its war with Iran and is scheduled to address the nation on Thursday, prompting a reversal of some trades that had been popular as a safe haven.
Analysis of major currency trends
U.S. dollar: As of press time, the U.S. dollar index is hovering around 99.55. The U.S. dollar index (DXY) fell more than 0.5% on Wednesday, opening close to 99.90 and then falling to an intraday low of about 99.30. The index came under sustained selling pressure throughout the trading session, with the intraday chart showing a series of lower highs as ceasefire talk gained traction. Wednesday's losses extend Tuesday's move above the 100.00 mark, which has now given back most of March's 2.3% safe-haven gains from January's low of 95.55.



1. Trump asked the military to propose a plan to seize Iranian nuclear materials
On April 1, local time, according to the "Washington Post" report, two people familiar with the matter revealed that the U.S. military has submitted a plan to U.S. President Trump to seize more than 460 kilograms of high-abundance enriched uranium in Iran. The plan involves flying excavation equipment into the site and building a runway to allow cargo planes to transport the nuclear material out, the report said. According to people familiar with the matter, Trump had previously asked the military to submit a relevant plan, and the military reported this xmaccount.complex plan to him in the past week, and also explained the major operational risks contained in the plan. According to reports, Trump’s request indicates that he is deliberately considering an extremely sensitive and high-risk special operations mission.
2. Iran’s Ministry of Foreign Affairs: Iran’s Supreme Leader is in good health, but his public appearance has been postponed due to the war
According to a report by Iran’s Islamic Republic News Agency on April 1, Iranian Foreign Ministry spokesperson Bagaei said in an interview with the media that Iran’s Supreme Leader Mujtaba Khamenei is in good health, but his public appearance has been postponed due to the war. Baghaei told "Egyptian Today": "He (Mujtaba) is in good health. I think it may take some time for him to appear in public under the current wartime situation, which is not surprising. But I assure you that the country, government administration and national defense are operating efficiently."
3. Trump became the first person in U.S. history to attend a Supreme Court hearing.President
On April 1, local time, the U.S. Supreme Court opened a hearing to review the legality of President Trump’s directive to restrict birthright citizenship in the United States. The controversial plan, which is tied to the Trump administration's efforts to curb immigration, would upend long-held understandings of a key provision of the U.S. Constitution if implemented. Trump attended an oral argument at the Supreme Court on the policy of restricting birthright citizenship, becoming the first sitting president in U.S. history to attend a Supreme Court hearing in person. Demonstrators gathered outside the courthouse, some holding anti-Trump signs. According to Clare Cushman, resident historian of the Supreme Court Historical Society, Trump is the first sitting president to appear at an oral argument before the Supreme Court. Although there are historical precedents for presidents to argue cases before the Supreme Court in the 19th century, they were no longer in office at the time, including John Quincy Adams, Grover Cleveland, and Benjamin Harrison.
4. S&P: The U.S. manufacturing industry shows resilience in the context of conflicts in the Middle East
Chris Williamson, chief business economist of S&P Global Market Intelligence, said based on the U.S. PMI data for March that the U.S. manufacturing industry has shown encouraging resilience amid the outbreak of war in the Middle East. Business confidence in output in the xmaccount.coming year has also remained good so far. This continued resilience stems in part from reduced concerns about government policy and also suggests that producers expect the impact of the war to be short-term and limited, but uncertainty remains. For now, the impact of the conflict is still in its early stages, with sharp price increases and delivery delays already clouding the outlook, potentially pushing up inflation, dampening demand and hampering supply chains. Factory input costs have risen sharply, driven by surging oil prices, while supplier delays are more xmaccount.common than at any time since October 2022. As a result, some manufacturers are building inventories in preparation for future price increases or supply shortages, and hiring has xmaccount.come to a near standstill to reduce labor costs, underscoring concerns that the war could cause problems for factories in the xmaccount.coming weeks.
5. Fed Musallem: The current interest rate setting is still appropriate
St. Louis Fed President Musallem said on Wednesday that the Fed's current interest rate stance may still be appropriate for the foreseeable future, and he may support the next step in cutting or raising interest rates based on economic trends. Mussallem said the Fed's 3.5%-3.75% interest rate target is a good balance in the face of risks such as persistent inflation and a labor market that has shown signs of fragility in recent months. The rate target is likely to be at the lower end of the neutral range, suggesting that further cuts could inadvertently push up inflation. "Policy can effectively address the risks of the dual mandate, and I expect that current policy rate levels will remain relevant for some time," Mussallem noted. He said he may ultimately support further interest rate cuts if the labor market weakens and a rate cut does not damage the Fed's credibility in fighting inflation. But he also said he might support raising interest rates if inflation rises or if the public loses confidence in the Fed's response to inflation.
Institutional perspective
1. NetherlandsInternational: The pound may weaken against the euro because the market has more room to adjust the Bank of England's interest rate expectations than the European Central Bank. Francesco Pesole of ING said in a report that the pound may weaken against the euro because the market has more room to lower the Bank of England's interest rate expectations than the European Central Bank. Bank of England officials have spoken cautiously about raising interest rates, and the central bank had been preparing to cut interest rates before the outbreak of the war with Iran. Furthermore, the UK economy is likely to be one of the hardest hit by energy price shocks. ING believes that the market will fully digest the expectation that the Bank of England will no longer raise interest rates. LSEG data shows that the British money market is currently pricing in a cumulative rate hike of 48 basis points by December, while the European Central Bank's corresponding rate hike expectation is 62 basis points. 2. Goldman Sachs is bearish on expectations for the Federal Reserve to raise interest rates this year
Goldman Sachs analysts pointed out in the report that since the outbreak of the war with Iraq, the market pricing of the U.S. federal funds rate has fluctuated wildly, but the possibility of raising interest rates this year is still low. Analysts say the current supply shock is smaller and more localized than past shocks that triggered inflationary problems, and oil prices are rising less than in the 1970s. In addition, they believe that "the starting point of the economy makes the possibility of large-scale inflation spillovers low," and the current starting point of monetary policy also reduces the probability of raising interest rates. Analysts emphasized: "The Fed usually does not tighten policy just in response to oil shocks."
3. Capital Economics: Euro zone inflation data does not provide many clues to future trends
Capital Economics economist Andrew Kenningham said in a report that although euro zone inflation recorded the largest monthly increase since the end of 2022, these data do not provide a clear signal about how much prices will rise and how energy prices will be transmitted to broader inflation indicators. Headline inflation rose to 2.5% in March from 1.9% in February, driven almost entirely by rising fuel prices. There is a high degree of uncertainty about the extent of the transmission of energy prices to core and services inflation, as well as the ECB's policy response function. Kenningham expects headline inflation to rise to close to 4% and core inflation to close to 3% by the end of 2026, but much will depend on the duration of the Iran war. He said both indicators may fall again in 2027.
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