The US dollar index continued to trade weaker ahead of next week’s Fed meeting and the upcoming G20 summit at the end of the month. As inflation and other economic data weakens in the US, the markets are expecting the Fed to hint at the possibility of a rate cut during next week’s meeting.

The US dollar fell from two-year highs above 98 in May, and the dollar index DXY is now trading at 97.07 at the time of writing. Interest rate futures traders have increased the likelihood of a rate cut happening in July to 89%.

Meanwhile, the ongoing US-China trade war also continues to weigh on the dollar. Investors wait and watch to see how the meeting between Trump and his Chinese counterpart Xi Jinping progresses at the G20 summit. There are also increasing concerns that Trump could soon announce tariffs on Japan and Europe as well.