USDInd near 5-month lows amid trade, Fed uncertainty

• USD Index stays near 5-month lows at 103.3
   
• Weak US retail data adds to economic concerns
   
• Fed minutes show cautious and divided policymakers
   
• Markets eye Fed, BoJ, and BoE policy decisions

USDInd hovered around 103.3 on Tuesday, staying near its five-month lows amid economic uncertainty and trade tensions.
 

Concerns over President Trump’s aggressive tariff stance have fueled worries about a potential economic slowdown.

Adding to the cautious sentiment, US retail sales data for February came in weaker than expected (0.2% – actual vs 0.6% – expected), with the previous month’s figures also revised lower.

At the same time, the latest Fed minutes revealed a divided but cautious central bank. Many officials favored keeping rates at restrictive levels if inflation remained high, while others saw room for cuts if economic conditions worsened.

Policymakers also pointed to risks such as trade shifts, geopolitical disruptions, and resilient consumer spending as factors that could keep inflation elevated.
 

Markets now turn to Wednesday’s Fed decision, where no changes are expected.

Investors are still pricing in 60 basis points of cuts this year, while upcoming policy meetings from the Bank of Japan and the Bank of England add further uncertainty.