FX.co ★ Dollar Down for 3rd Day

The dollar index has experienced a decline for the third consecutive session, dropping to 99.7 on Wednesday—its lowest mark in two weeks. This downward trend comes as market participants turn their attention to the upcoming G7 finance ministers' summit, seeking insights on whether the US administration might be inclined to accept a weaker dollar. Speculation regarding a potential decline in the dollar has been further fueled by recent developments indicating that Japanese and South Korean officials plan to engage in currency discussions with the US. Simultaneously, there are increasing fiscal concerns within the United States. President Trump is actively urging Congressional Republicans to rally behind a comprehensive tax-cut initiative; however, he has yet to persuade critical dissenters whose opposition could jeopardize the legislation. Adding further strain to the dollar, Moody’s downgraded the US credit rating last Friday, lowering it to Aa1 and thereby removing the country's last triple-A credit rating from a major international agency. The downgrade was attributed to apprehensions regarding escalating government debt and a growing budget deficit. The dollar has broadly weakened, with significant losses observed against the yen and the euro.