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The U.S. dollar continues its upward climb, bolstered by a slew of supportive factors dominating the markets as of April 7, 2025. According to Noor Trends’ latest economic report, the greenback kicked off Monday’s trading session with a strong recovery, riding the wave of rising U.S. Treasury yields. These gains are largely tied to escalating tariff fears and potential retaliatory moves from nations opposing Washington’s trade policies under President Donald Trump, who began his second term in January.
The dollar also found a tailwind from last month’s U.S. jobs data, which exceeded market expectations. March saw significant job growth, though wage increases slowed slightly, casting a spotlight on a deteriorating labor market signaled by a uptick in unemployment. The dollar index, tracking the currency against a basket of major peers, climbed to 103.44 points from its previous close of 103.00. The index hit a daily low of 102.18 points but peaked at 103.51, reflecting its robust momentum.
Federal Reserve Chair Jerome Powell weighed in last Friday, warning that “the larger the tariffs, the greater the risk of higher inflation and slower growth.” Powell emphasized it’s too early to chart the Fed’s next monetary policy move, noting that tariffs could stoke inflation in the coming quarters, potentially leaving a lasting imprint. “The uncertainty surrounding these tariffs—and the counteractions from affected nations—only amplifies their economic impact,” he said, projecting higher inflation and weaker growth as the likely fallout.
Jobs Data Drops a Bombshell
Friday’s U.S. employment figures stunned markets. Nonfarm payrolls surged by 228,000 jobs in March, far outpacing the revised 117,000 from the prior month and smashing expectations of 135,000. Hourly earnings rose 0.3% month-over-month, aligning with forecasts, though annual wage growth dipped to 3.8% from 4.0% a year earlier. Meanwhile, the unemployment rate edged up to 4.2% from 4.1%, darker than analysts had anticipated.
Trump’s Trade Triumph?
President Trump took to his Truth Social platform Friday, touting a “highly productive” call with Vietnam’s Socialist Party General Secretary To Lam. “Lam told me Vietnam wants to cut tariffs to zero if we can strike a deal with the U.S.,” Trump wrote, adding that he thanked him on behalf of the nation and looks forward to a near-future meeting.
Trump also prodded Fed Chair Powell to slash interest rates, claiming, “Energy prices, interest rates, inflation—even egg prices, down 69%—have all improved, and job growth soared in just two months. It’s a huge win for America. Cut rates, Jerome, and stop playing politics!” His remarks underscore his push for a looser monetary stance to complement his tariff-driven agenda.
What’s Next for the Dollar?
As tariff tensions simmer and jobs data fuels debate, the dollar’s trajectory hinges on how these forces play out. With Trump doubling down on trade hardball and Powell signaling caution, markets are bracing for a volatile ride. For now, the greenback’s rally shows no signs of slowing, keeping investors on edge as the economic calendar unfolds.
