The US dollar index (DXY) continued its slide on Friday, falling near the 100 area after hitting a fresh three-year low earlier in the day. The downtrend reflects a broad decline in investor confidence as fresh data and central bank comments paint a grim picture for the US economy. The University of Michigan sentiment index fell in April, while the Producer Price Index came in below estimates, adding to market fears of disinflation. Several Federal Reserve officials have flagged rising inflation expectations as a risk, even as near-term economic data hints at weakening demand.

Technically, momentum remains firmly bearish as the DXY extends its decline.

Daily market digest: US dollar drops on consumer gloom, tariff impact

The University of Michigan sentiment gauge fell to 50.8 in April, while inflation expectations jumped to 6.7% on a one-year view. New York Fed's Williams and Boston Fed's Collins warned of rising trade-related inflation risks and a possible slowdown in growth.

The US Producer Price Index rose 2.7% year-on-year in March, down from 3.2% in February, while the core rate slowed to 3.3%.

Jobless claims edged up to 223,000, with continuing claims falling to 1.85 million, signaling mixed employment dynamics.

China confirmed retaliatory tariffs on US imports, matching Washington's tariff hike to 125% and rekindling fears of a global recession. (Newsmaker23)

Source: FXstreet