The dollar staged a broad retreat on Thursday, as investor gloom over the lack of progress toward defusing the U.S.-China trade war reasserted itself following an interlude of optimism the previous day.

President Donald Trump is badgering the Federal Reserve to cut interest rates, but even if the Fed gave in to the pressure, it wouldn’t necessarily lead to lower borrowing costs for consumers

But President Donald Trump’s new declaration that he has “no intention” of firing Federal Reserve Chair Jerome Powell should — in theory, anyway — be very good news for bonds. It potentially lifts a huge cloud of uncertainty that has been depressing bond prices for weeks.

Treasuries rallied for a second week, all but erasing this month’s losses, amid signs the Trump administration is making efforts to deescalate trade tensions.

The dollar jumped on Friday, reversing losses from the prior day after a media report that China was weighing tariff exemptions for some U.S. goods, stoking hopes for a de-escalation in a spiralling trade war between the world's two largest economies.

The dollar is moderately lower today because of concerns that the US-China trade war will drag on after China said there were no talks on reaching a trade deal with the US. Also, Treasury Secretary Bessent said President Trump hasn’t offered to take down US tariffs on China on a unilateral basis.