The US Dollar Index remains steady around 99.50 amid subdued trading activity due to the Good Friday holiday.

The US Dollar Index (DXY), which tracks the performance of the US Dollar (USD) against a basket of six major currencies, remains under pressure, holding below the 99.50 mark in early European trading on Friday. The Greenback is subdued as investors grow increasingly concerned about the potential economic fallout from US-imposed tariffs. While traders keep a close eye on developments in US trade negotiations, overall market activity is likely to remain muted due to the Good Friday holiday.

Nonetheless, the Dollar found some support following hawkish comments from Federal Reserve Chair Jerome Powell, who warned that a sluggish economic backdrop coupled with sticky inflation could complicate the central bank’s policy objectives and elevate the risk of stagflation. At the same time, former President Donald Trump criticized Powell for being too slow in lowering interest rates, stating that his removal “can’t come quickly enough.”

According to the CME FedWatch Tool, money market traders are now pricing in approximately 86 basis points of interest rate cuts from the Federal Reserve by the end of 2025, with the first rate reduction expected as early as July.

Meanwhile, on Thursday, former US President Donald Trump stated that China had made several overtures toward negotiations, adding, “I don’t want to go higher on China tariffs. If China tariffs go higher, people won’t buy.” He also expressed confidence that a trade deal with China could be finalized within three to four weeks.

On the labor front, the US Department of Labor reported that Initial Jobless Claims declined to 215,000 for the week ending April 12, beating expectations and down from the prior week’s revised total of 224,000 (previously reported at 223,000). However, Continuing Jobless Claims rose by 41,000 to 1.885 million for the week ending April 5.