The Dollar was on track for its strongest weekly performance in nearly three years against major currencies on Friday, continuing its upward momentum after US President Donald Trump announced new tariffs on multiple trade partners.

Additional support for the Dollar came from non-tariff factors as well, with the Yen falling to a four-month low, extending Thursday’s sharp drop following signals from the Bank of Japan that it was in no rush to resume raising interest rates.

Japanese Finance Minister Katsunobu Kato responded on Friday by expressing concern over recent currency fluctuations, stating that officials are “alarmed” by the moves.

The Yen was trading at 150.46 per Dollar at the time of writing after briefly sliding to 150.915, its lowest level since 28^th March.

Meanwhile, the Dollar index, which tracks the greenback against six major currencies, is set to gain 2.4% this week, marking its strongest weekly performance since a 3.1% surge in September 2022.

On Friday, the index edged up 0.1% to 100.14, reaching its highest level since 29^th May, Reuters reports.

Moreover, the Euro stayed near a nearly two-month low around $1.1428, pressured by what investors perceive as an imbalanced trade deal with Washington. That level was close to Wednesday’s low of $1.1401, the weakest the single currency has been since 10^th June.

“In the short-term, you can make the case for more Dollar strength. The lion's share of the tariff news has washed through,” according to Mike Houlahan, director at Electus Financial in Auckland.

“The big move of the week has really been the Euro getting rerated downwards. The net result would be the EU-US trade deal is a further headwind for the Euro.”

The trade framework agreement between the EU and the US, reached on Sunday, faced swift backlash from French officials and the German head of the European Parliament’s trade committee, who criticised it as being unfavourable to Europe.

Despite President Trump intensifying his criticism of Federal Reserve Chair Jerome Powell, labelling him a “terrible” Fed Chair and calling his own decision to appoint him a “mistake,” the Dollar remained strong.

Furthermore, Trump’s persistent threats to dismiss Powell and his demands for aggressive interest rate cuts have raised concerns about the Federal Reserve’s independence, weighing on the Dollar in recent months.

However, the Fed pushed back against that pressure on Wednesday, opting to keep policy unchanged while noting “somewhat elevated” inflation and a “solid” labour market as key factors in its decision.

That assessment of the labour market will face scrutiny later today with the release of the closely watched monthly payrolls report.

Economists anticipate a slowdown in job growth, projecting 110,000 new jobs added in July compared to 147,000 in the previous month, a deceleration, but not one seen as particularly alarming.