Asian Shares Creep Higher, Dollar Languishes

Asian shares inched higher while the U.S. dollar weakened ahead of a key policy update from the European Central Bank (ECB), as investors assessed a tumultuous global economic outlook, Rocky Swift reported for Reuters.

Signs of strain on the U.S. economy are becoming more evident amid President Donald Trump’s erratic tariff actions and a lack of progress on bilateral trade deals.

The dollar slid in the previous session following weak U.S. employment and services sector data, with more comprehensive labor figures expected Friday. Signs of strain on the U.S. economy are becoming more evident amid President Donald Trump’s erratic tariff actions and a lack of progress on bilateral trade deals.

MSCI’s broadest index of Asia-Pacific shares outside Japan rose 0.7% in early trade, while Japan’s Nikkei index slipped 0.2%.

The U.S. dollar index, which measures the greenback against a basket of major currencies, was flat at 98.85 after dropping 0.5% on Wednesday.

Meanwhile, Canada announced it was preparing retaliatory measures against new U.S. metals tariffs, while the European Union reported progress in its trade negotiations with Washington.

With that backdrop, investors are closely watching the ECB, which is widely expected to cut interest rates. Greater focus will be placed on ECB President Christine Lagarde’s guidance about future monetary policy.

“There’s uncertainty about the guidance the central bank will deliver, given the murky outlook for U.S. trade policy and global growth,” said Kyle Rodda, senior financial market analyst at Capital.com.