FOMC minutes released earlier this week revealed growing concern among policymakers about balancing inflation and slowing growth—supporting the case for a more cautious Fed pivot.
Key Data Ahead: PPI and Sentiment to Guide USD
Labor market data added to uncertainty. Jobless claims rose to 223,000, while continuing claims fell to 1.85 million, suggesting the labor market is steady but softening.
Geopolitical risks remain elevated.
Although the U.S. paused new tariffs on most trading partners for 90 days, tensions with China continue after a 125% U.S. tariff was met with 84% Chinese retaliation. Slowing Chinese inflation (-0.1% CPI in March) has further clouded the global outlook.
Friday’s upcoming data will be key. At 12:30 p.m. GMT, March PPI is expected at 0.2%, with Core PPI at 0.3%. At 2:00 p.m. GMT, the University of Michigan’s Consumer Sentiment Index is forecast to fall to 54.0, while inflation expectations are seen at 5.0%. These figures will help shape the next leg for the U.S. dollar.
