The dollar index hovered around 98.8 on Wednesday, trading sideways for the week as investors assessed the Federal Reserve’s policy outlook amid mixed economic data and renewed trade tensions. ISM data showed US services activity nearly stalled in July, falling short of expectations and underscoring the economic drag from President Donald Trump’s tariffs. Meanwhile, Trump said he will announce a nominee to fill a vacancy on the Fed’s Board of Governors by the end of the week, while also narrowing the list of potential replacements for Chair Jerome Powell. Markets continued to price in a more than 90% probability of a Fed rate cut in September, with about 60 basis points of easing anticipated by year-end. On the trade front, Trump threatened to impose tariffs of up to 250% on pharmaceutical imports and potential levies on semiconductors.