USD weakens on mixed data as global trade tensions escalate

The US Dollar Index declined 0.4% to 103.20 as mixed economic signals clouded the Federal Reserve's policy outlook, while escalating trade tensions drove flows into safe-haven assets. Recent US data showed conflicting signals with robust consumer spending offset by weakening manufacturing indicators, leaving markets uncertain about the Fed's next move. Global trade concerns intensified as the US administration threatened new tariffs on major trading partners, prompting a flight to traditional safe havens. JPY and CHF both gained against the greenback, with USD/JPY falling 0.6% to 154.80 and USD/CHF dropping 0.5% to 0.8920. Gold prices surged 1.2% to $2,385 per ounce amid the risk-off sentiment. The dollar's weakness was broad-based, with EUR/USD advancing to 1.0880 and GBP/USD climbing to 1.2750. Markets now await this week's Fed speakers and US retail sales data for clarity on monetary policy direction.