Dollar languishes against major peers as markets weigh trade deals, tax bill
Senate Republicans will try to pass President Donald Trump's sweeping tax-cut and spending bill, despite divisions within the party about its expected $3.3 trillion hit to the nation's debt pile.
The dollar was down 0.44% to 0.79475 against the Swiss franc. The euro was up 0.28% at $1.175450 against the dollar. The greenback was set to finish the month 3.4% down against the franc, while the euro was set to gain about 3.6% against the dollar.
"You have a weak dollar due to a potentially large increase in our budget deficit, and you have continued uncertainty around these tariff deals," said Eugene Epstein, head of structuring for North America at Moneycorp in New Jersey.
Treasury Secretary Scott Bessent said that countries could still face sharply higher tariffs on July 9 even if they are negotiating in good faith, adding that any potential extensions will be up to Trump.
The U.S. and China had resolved issues around shipments of Chinese rare earth minerals and magnets to the United States, further modifying a May deal in Geneva, Bessent had said last week.
"We had this positive news from the EU for a little bit and we had potential positive deals coming up, but then you had Trump doing a temporary about-face on Friday on Canada and so forth," Epstein said.
The dollar was down 0.19% to 144.33 against the Japanese yen , on track to finish the month flat versus the Asian currency.
Canada halted its plans to begin collecting a new digital services tax targeting U.S. technology firms just hours before it was due to start on Monday in a bid to advance stalled trade negotiations with Washington.
The Canadian dollar strengthened against the U.S. currency on the session. It was set to notch its fifth straight month of gains against the greenback. The loonie was up 0.36% versus the greenback to C$1.36 per dollar.
The dollar index , which measures the greenback against a basket of currencies including the yen and the euro, fell 0.15% to 97.05, on track for its sixth straight month of losses. It is set to mark its worst half-year since the 1970s.
"It's kind of rotating a game of musical chairs, whether it's the 'big beautiful bill', the trade deals, and then the Iran-Israel conflict. It's all like taking turns to be at center stage; once one thing passes and the other thing is focused on," Epstein said.
Sterling weakened 0.12% to $1.3698. The Australian dollar strengthened 0.52% versus the greenback to $0.6563.
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