US Dollar Index Advances on Fed Speculation, Trade Policy Uncertainty, and Eurozone Weakness

The U.S. Dollar Index (DXY) ended the week of May 30 at 99.443, up 0.34%. The greenback posted this moderate gain in a holiday-shortened week, as traders reacted to renewed trade policy concerns, mixed U.S. economic data, and signs of economic stagnation in major trading partners.

Dollar strength early in the week followed a federal appeals court ruling that reinstated certain U.S. tariffs, reversing a previous block. The legal outcome injected fresh uncertainty into trade relations, notably with China, and supported a flight to safety that pushed the DXY briefly above 100. However, the index later eased as traders weighed the broader implications of prolonged trade policy friction on U.S. growth.