#FedRateCutAffectsDollarTrend The U.S. dollar trend is influenced by several key factors, including Federal Reserve policies, economic data, and global market conditions. Here’s what drives the dollar’s movement: 1. Federal Reserve & Interest Rates Rate Hikes → Stronger Dollar: Higher interest rates attract foreign capital, increasing demand for the dollar. Rate Cuts → Weaker Dollar: Lower rates make U.S. assets less attractive, reducing dollar demand. 2. Inflation & Economic Data High Inflation → Weakens Dollar (if the Fed doesn’t act aggressively). Strong Economic Growth → Strengthens Dollar (as it signals stability and investment appeal). 3. Risk Sentiment & Global Uncertainty Safe-Haven Demand: In times of crisis (wars, recessions), investors buy the dollar as a safe asset. Market Confidence: When global markets are stable, investors shift to risk.