The U.S. dollar bounced back on Wednesday after hitting an 11-week low, supported by a rebound in short-term Treasury yields. However, weak U.S. economic data and expectations of upcoming Federal Reserve rate cuts continue to weigh on investor sentiment.

Key Market Developments
? Dollar Index Volatility

DXY rose 0.3% to 106.51 in Asian trading, recovering from a low of 106.13 (weakest since Dec. 10).
The Tuesday drop (-0.5%) was driven by disappointing consumer confidence data.

? U.S. Economic Weakness & Fed Rate Cut Expectations

Conference Board Consumer Confidence fell to 98.3 (vs. 102.5 expected), marking its largest decline since August 2021.
Weak economic reports increase bets on two Fed rate cuts this year, with the next likely in July.

? Impact on North American Currencies

Canadian Dollar: Hit a two-week low, pressured by upcoming U.S. tariffs.
Mexican Peso: Also weakened as Trump’s tariff policies weighed on sentiment.

Investors tracking foreign exchange volatility and macroeconomic risks can leverage the Historical Earnings API to assess past market reactions to economic events.

Market Outlook: Will Dollar Strength Hold?
? Key Factors to Watch:1?? U.S. Treasury Yield Movements – Will yields continue rebounding, or will weak data pressure rates lower?2?? Tariff Impact on USD/CAD & USD/MXN – Currency volatility may increase as new tariffs take effect.3?? Upcoming Fed Decisions – Expectations of rate cuts could limit dollar gains in the coming months.
With ongoing market uncertainty, currency traders remain cautious, awaiting further economic data and Fed policy signals for direction.