{"id":19386,"date":"2025-03-27T03:06:54","date_gmt":"2025-03-27T03:06:54","guid":{"rendered":"https:\/\/www.vtmarkets.com\/?p=19386"},"modified":"2025-03-27T03:06:54","modified_gmt":"2025-03-27T03:06:54","slug":"dollar-index-slips-on-tariff-shock","status":"publish","type":"post","link":"https:\/\/www.vtmarkets.com\/en-asia\/analysis\/dollar-index-slips-on-tariff-shock\/","title":{"rendered":"Dollar Index Slips on Tariff Shock"},"content":{"rendered":"\n<figure class=\"wp-block-image size-large\"><img loading=\"lazy\" decoding=\"async\" width=\"1024\" height=\"559\" src=\"https:\/\/www.vtmarkets.com\/en-asia\/wp-content\/uploads\/sites\/27\/2026\/03\/image_fx_-2025-03-25T110734.903-1024x559.png\" alt=\"\" class=\"wp-image-19387\" \/><\/figure>\n\n\n\n<p><strong>Key Points:<\/strong><\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>Dollar index retreats to 103.99 after peaking at 104.29.<\/strong><\/li>\n\n\n\n<li><strong>Trump&#8217;s 25% auto tariff announcement sparks trade concerns and hits sentiment.<\/strong><\/li>\n<\/ul>\n\n\n\n<hr class=\"wp-block-separator has-alpha-channel-opacity is-style-dots\" \/>\n\n\n\n<p>The <strong>U.S. dollar index (USDX)<\/strong> fell to <strong>103.99<\/strong> on Thursday, pulling back from a <strong>session high of 104.29<\/strong>, as traders digested a wave of <strong>negative sentiment following fresh trade policy announcements<\/strong> and <strong>softer-than-expected U.S. data<\/strong>. The index closed lower despite earlier gains, reflecting <strong>rising caution across FX markets<\/strong>.<\/p>\n\n\n\n<p>Late Wednesday, <strong>President Trump confirmed a 25% tariff on all imported cars and light trucks<\/strong>, effective <strong>April 2<\/strong>, alongside <strong><a href=\"https:\/\/t.co\/ah1IFcArPZ\">reciprocal tariffs on nations that tax U.S. goods<\/a><\/strong>. The announcement escalated <strong>trade war concerns<\/strong>, with Trump pledging to maintain the measures throughout a potential <strong>second presidential term<\/strong>.<\/p>\n\n\n\n<figure class=\"wp-block-embed is-type-rich is-provider-twitter wp-block-embed-twitter\"><div class=\"wp-block-embed__wrapper\">\n<blockquote class=\"twitter-tweet\" data-width=\"500\" data-dnt=\"true\"><p lang=\"en\" dir=\"ltr\">The Trump administration\u2019s 25% tariff on US auto imports will likely deliver only a small blow to Japan\u2019s economy <a href=\"https:\/\/t.co\/ivfAFbM8I9\">https:\/\/t.co\/ivfAFbM8I9<\/a><\/p>&mdash; Bloomberg (@business) <a href=\"https:\/\/twitter.com\/business\/status\/1905064179439943896?ref_src=twsrc%5Etfw\">March 27, 2025<\/a><\/blockquote><script async src=\"https:\/\/platform.twitter.com\/widgets.js\" charset=\"utf-8\"><\/script>\n<\/div><\/figure>\n\n\n\n<p>Markets reacted with unease, as the proposed tariffs are expected to <strong>slow economic growth<\/strong>, particularly in consumer and manufacturing sectors. The renewed inflation risks, coupled with <strong><a href=\"https:\/\/www.cnbc.com\/2025\/03\/25\/consumer-confidence-in-where-the-economy-is-headed-hits-12-year-low.html\">weaker consumer sentiment<\/a><\/strong>, have added fresh uncertainty.<\/p>\n\n\n\n<h2 class=\"wp-block-heading has-medium-font-size\">Confidence and Investment Indicators Weaken<\/h2>\n\n\n\n<p>Further adding to the dollar\u2019s pullback, <strong><a href=\"https:\/\/www.aljazeera.com\/economy\/2025\/3\/25\/us-consumer-confidence-plunges-to-four-year-low\">U.S. consumer confidence dropped to its lowest level in over four years<\/a><\/strong>, pointing to <strong>growing household unease<\/strong> about inflation and economic stability.<\/p>\n\n\n\n<p>Moreover, <strong><a href=\"https:\/\/www.reuters.com\/markets\/us\/us-core-capital-goods-orders-unexpectedly-drop-february-2025-03-26\/\">new orders for non-defense capital goods excluding aircraft<\/a><\/strong>\u2014a key indicator of business investment\u2014<strong>declined unexpectedly<\/strong> after three straight months of growth. The reading raises concerns about the resilience of corporate spending amid <strong>rising input costs<\/strong> and <strong>uncertain trade conditions<\/strong>.<\/p>\n\n\n\n<h2 class=\"wp-block-heading has-medium-font-size\">Technical Analysis<\/h2>\n\n\n\n<p>The USDX (US Dollar Index) chart on the 15-minute timeframe shows a <strong>steady uptrend<\/strong> that peaked around the <strong>104.296 level<\/strong> before pulling back slightly. After a minor dip to the 103.579 support, price gradually climbed higher, supported by rising moving averages (MA 5,10,30), which <strong>indicate bullish momentum<\/strong>.<\/p>\n\n\n\n<figure class=\"wp-block-image size-large\"><img decoding=\"async\" src=\"https:\/\/www.vtmarkets.com\/en-asia\/wp-content\/uploads\/sites\/27\/2026\/03\/image-32-1024x446.jpg\" alt=\"\" class=\"wp-image-19388\" \/><\/figure>\n\n\n\n<p class=\"has-text-align-center\"><em>Picture: USDX retreats from 104.296 after strong rally, with MACD signaling a potential pullback, as seen on the <\/em><em><a href=\"https:\/\/vtmarketsapp.onelink.me\/CD7D\/240525WA\">VT Markets app<\/a><\/em><\/p>\n\n\n\n<p>However, recent price action shows some <strong>consolidation near the upper resistance band<\/strong>, followed by a slight downturn. The MACD histogram has started to print red bars, with the MACD line crossing <strong>below the signal line<\/strong> \u2014 an early signal that bullish momentum is weakening. If price slips below 103.994, the next <strong>key support lies near 103.614<\/strong>.<\/p>\n\n\n\n<h2 class=\"wp-block-heading has-medium-font-size\">Eyes on Friday\u2019s PCE Report<\/h2>\n\n\n\n<p>With risk sentiment softening and macro headwinds growing, traders now turn to <strong>Friday\u2019s release of the <\/strong><strong><a href=\"https:\/\/www.bea.gov\/data\/personal-consumption-expenditures-price-index\">PCE price index<\/a><\/strong>, the <strong>Federal Reserve\u2019s preferred inflation gauge<\/strong>, for confirmation on the <strong>direction of interest rates<\/strong>.<\/p>\n\n\n\n<p>In the near term, the dollar may trade within a <strong>103.60\u2013104.30 range<\/strong>, with downward pressure likely to build if the PCE report confirms cooling inflation. Conversely, an upside surprise in core inflation could see the greenback rebound back toward <strong>104.50<\/strong>.<\/p>\n\n\n\n<p>Until then, <strong>tariff anxiety and weak domestic data are likely to cap upside momentum<\/strong>, keeping traders cautious and FX flows defensive.<\/p>\n\n\n\n<p><strong><a href=\"https:\/\/www.vtmarkets.com\/trade-now\/\">Create your live VT Markets account<\/a><\/strong><strong> and <\/strong><strong><a href=\"https:\/\/myaccount.vtmarkets.com\/login\">start trading<\/a><\/strong><strong> now.<\/strong><\/p>\n","protected":false},"excerpt":{"rendered":"<p>USDX falls to 103.99 after Trump\u2019s auto tariffs and soft US data dent confidence. Traders await Friday\u2019s key PCE report. &#8211; vtmarkets.com<\/p>\n","protected":false},"author":64,"featured_media":19387,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[31],"tags":[9],"class_list":["post-19386","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-analysis","tag-dollar"],"acf":{"acf_article_selection_author":null},"aioseo_notices":[],"_links":{"self":[{"href":"https:\/\/www.vtmarkets.com\/en-asia\/wp-json\/wp\/v2\/posts\/19386","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.vtmarkets.com\/en-asia\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.vtmarkets.com\/en-asia\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.vtmarkets.com\/en-asia\/wp-json\/wp\/v2\/users\/64"}],"replies":[{"embeddable":true,"href":"https:\/\/www.vtmarkets.com\/en-asia\/wp-json\/wp\/v2\/comments?post=19386"}],"version-history":[{"count":0,"href":"https:\/\/www.vtmarkets.com\/en-asia\/wp-json\/wp\/v2\/posts\/19386\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.vtmarkets.com\/en-asia\/wp-json\/wp\/v2\/media\/19387"}],"wp:attachment":[{"href":"https:\/\/www.vtmarkets.com\/en-asia\/wp-json\/wp\/v2\/media?parent=19386"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.vtmarkets.com\/en-asia\/wp-json\/wp\/v2\/categories?post=19386"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.vtmarkets.com\/en-asia\/wp-json\/wp\/v2\/tags?post=19386"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}