US Dollar Index Rises Toward 99.00, Bounces Back from Six-Week Lows

US Dollar Index Rises Toward 99.00, Bounces Back from Six-Week Lows

The US Dollar Index (DXY) has staged a rebound from a six-week trough at 98.58, rising near the 99.00 level during Tuesday’s Asian session. The index tracks the US Dollar against six major currencies, reflecting broad USD strength despite mixed economic signals.

Declining US Manufacturing PMI

The Institute for Supply Management (ISM) Manufacturing PMI fell for the third consecutive month, registering 48.5 in May compared to 48.7 in April, and missing expectations of 49.5. This signals ongoing contraction in the US manufacturing sector.

Market Reaction to Trade News

Market sentiment improved as China’s Ministry of Commerce dismissed US President Donald Trump’s claims about breaking a tariff truce, easing fears of escalating trade tensions.

However, President Trump announced plans to double tariffs on steel and aluminum imports—from 25% to 50%—starting Wednesday, increasing pressure on global steel producers and intensifying the trade dispute.

Upcoming US Data to Watch

Traders will closely monitor the upcoming release of US JOLTS Job Openings later on Tuesday for further insights into labor market conditions and potential implications for the US Dollar.

Related Articles on Tredu.com:

• Impact of US Tariffs on Global Trade and Currencies
• Understanding the ISM Manufacturing PMI and Its Forex Effects
• US Dollar Index Trends and Forecast