The US dollar traded on a gloomy note at the close of last week after retreating slightly from a successful 1-week high.
The modest strengthening of the US dollar was driven by market sentiment factors that were at risk due to concerns about a global economic recession.
The United States (US) NFP employment data report which has been published with a declining figure for July is seen to further pressure the Federal Reserve (Fed) to lower interest rates at the September meeting.
Following mounting concerns over the past week, the Fed is expected to implement aggressive policy easing with high expectations for a rate cut of 50 basis points.
Fed members are also starting to express their views on the matter, but the answer will be in the hands of Chairman Jerome Powell.
Thus, the main indicator this week will be directed at the US consumer inflation data that will be published on Wednesday.
On Tuesday, producer inflation (PPI) data will be watched first for investors to assess changes in the prices of goods and services at the producer level in America.
Inflation will be an important indicator for the Fed after the previous jobs report came in with a worrying reading that saw the unemployment rate soar.
Investors should remain cautious for US dollar trading this week which is expected to remain volatile.
