US Dollar weakens amid Greenland tariff uncertainty – MUFG

💡 DMK Insight

The USD’s recent softness signals shifting investor sentiment amid trade uncertainty. With potential delays or cancellations of tariffs linked to Trump’s Greenland plans, traders might see this as a temporary reprieve from escalating trade tensions. This could lead to a short-term rally in risk assets, as a weaker dollar often boosts commodities and equities. Keep an eye on how this impacts correlated markets like gold and emerging market currencies, which typically benefit from a softer dollar. If the USD continues to weaken, watch for key levels around recent support zones, as a break could trigger further selling pressure. However, it’s worth noting that this optimism might be short-lived. If trade negotiations falter or other geopolitical tensions arise, the dollar could rebound sharply. So, monitor upcoming economic indicators and any news from the White House that could shift this narrative quickly.