Currency Markets Brace for Trump's Tariff Turmoil

The dollar held steady amid anticipated tariffs from President Trump, impacting currencies as traders await clarity on U.S. trade policies. The Australian and New Zealand dollars showed slight declines, while the euro and yen strengthened. U.S. Federal Reserve and central bank decisions remain in focus.

The dollar remained stable on Tuesday as investors prepared for new tariffs from U.S. President Donald Trump, while the Australian dollar approached a four-week low before the central bank's policy decision.

Attention is on the anticipated reciprocal levies from the White House, with details expected on Wednesday. Trump's tariff plans have already targeted aluminium, steel, autos, and all Chinese goods, leaving markets subdued and traders cautious.

The euro, benefiting from Germany's fiscal changes, maintained its strength, while the yen strengthened on speculation of further interest rate hikes. As trade tensions escalate, global currency markets remain on edge, awaiting signals from central banks and economic data releases.

(With inputs from agencies.)