The dollar index (DXY) fell by -0.55% on Tuesday, marking a 1-week low, influenced by President Trump’s announcement of a tentative ceasefire between Israel and Iran, which reduced safe-haven demand for the dollar. The decline was further supported by a sharp rally in stocks and an unexpected drop in the Conference Board’s June US consumer confidence index, which fell by -5.4 to 93.0, below expectations of an increase to 99.8.
Hawkish statements from key Federal Reserve officials, including Chair Powell and New York Fed President Williams, limited further losses. The futures market currently reflects a 19% probability of a -25 basis point rate cut during the July 29-30 FOMC meeting. Meanwhile, the euro rose by +0.39%, supported by a stronger-than-expected German Jun IFO business climate index, which reached a 13-month high of 88.4.
