The US dollar started the new week with a mostly softer tone, showing signs of consolidation. This week, investors are closely watching key economic indicators and central bank meetings from major economies. The US economy remains resilient despite concerns over a potential slowdown, with upcoming data expected to provide further clarity. Meanwhile, President Trump reiterated his stance on reciprocal and sectoral tariffs, set for announcement on April 2. In emerging markets, currency movements are mixed, with a notable adjustment in China’s reference rate, where the People's Bank of China (PBOC) set the dollar’s rate at its lowest in four months. Despite recent economic support measures, details remain unclear, keeping investor enthusiasm in check.

Asia Pacific Markets

The Japanese yen experienced volatility last week, with the dollar hitting a five-month low before rebounding near JPY148.50. Rising US yields, alongside lower Japanese rates, contributed to the yen’s weakness. The Bank of Japan’s upcoming meeting is in focus, with most analysts predicting no changes to monetary policy.
Meanwhile, China’s yuan has been under pressure, with the dollar reaching its weakest point against the yuan since late last year. 

European Markets

The euro showed resilience, supported by reports of a fiscal agreement among Germany’s leading political parties. The currency traded within a tight range, finding support around $1.0865. Investors are also monitoring ongoing negotiations regarding Germany’s economic policies.
In the UK, the British pound maintained stability despite concerns following a contraction in January's GDP. Sterling remained above $1.29, reflecting confidence in the market. This week, the Bank of England’s meeting is expected to confirm a cautious approach, with no immediate changes in interest rates anticipated. Additionally, employment data set for release later in the week will provide further insights into the UK’s economic outlook.

American Markets

The US dollar index continues to consolidate, struggling to gain momentum. Last week, it found support just below 103.25 but faced resistance around 104.00. Concerns about the US economy have been fueled by the Atlanta Federal Reserve’s GDP projection of -2.4%, though upcoming real-sector data could offer reassurance. February retail sales are expected to show growth, rebounding from a January decline. Additionally, improvements in housing starts and industrial output are anticipated, which may help ease fears of a deeper economic slowdown. Investors are closely watching these indicators alongside the Federal Reserve’s upcoming assessment to gauge the economic trajectory.