Dollar index attempts recovery from 2-week low

The dollar index is seen incurring mild gains although it continues to linger around a two week low on Wednesday. US President Donald Trump reportedly announced a trade deal with Japan that includes a 15% tariff on Japanese exports to the US. As part of the agreement, Japan will invest $550 billion in the US and open its markets to key American products. However, Trumps constant criticism about the Powell and investors doubts surrounding independence of Fed is keeping sentiments tepid. US Treasury yields continued to drop as the 10-year Treasury note slumps over five basis points (bps) to 4.332%, dragging on the greenback. The US Dollar Index (DXY), which tracks the greenbacks performance against a basket of six currencies, is near a two week low of 97.25. Investors now brace for US S&P Global Purchasing Managers Index (PMI) data for July, due this week and FOMC statement next week for further clarity on Federal stance.

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