US Dollar Index falls to near 97.00 near three-year lows

• The US Dollar Index has fallen to 96.98, the lowest since March 2022, as recorded on Monday.
• The US Dollar loses ground as traders expect that the Fed will start cutting interest rates in September.
• President Trump said that "One great big beautiful bill is moving along nicely!"

The US Dollar Index (DXY), which measures the value of the US Dollar (USD) against six major currencies, is continuing its losing streak that began on June 19, while trading around 97.20 during the European hours on Monday. Traders await US employment figures scheduled to be released later in the week, which may further offer fresh impetus on the US Federal Reserve's (Fed) policy outlook.

The US Nonfarm Payrolls report is expected to show the economy added 110,000 new jobs in June, down from 135,000 in May. The estimated range is currently between a high of 140,000 and a low of 75,000. Moreover, Unemployment is anticipated to tick higher to 4.3% from 4.2%.

The US Dollar struggles amid rising expectations of the Federal Reserve (Fed) cutting interest rates at the September meeting. Data showed on Friday that US Personal Spending unexpectedly fell in May, the second decline this year. Meanwhile, US Personal income dropped by 0.4% in May, the largest decrease since September 2021.

US President Donald Trump posted on Truth Social on Monday, saying, "One great big beautiful bill is moving along nicely!" The Trump Administration has gotten costs down, very substantially, for the American Consumer. There has never been anything like this!

The US Dollar received downward pressure from Friday's dovish comments from the President of the Federal Reserve Bank of Minneapolis, Neel Kashkari, who noted that he was sticking to his view that cooling inflation would allow the Fed to cut its policy rate twice that year, beginning in September.

However, Fed Chair Jerome Powell noted last week that Trump's tariff policies may cause a one-time price hike, but they could also lead to more persistent inflation. The Fed should be careful in considering further rate cuts.