After seven weeks of gains, the dollar is pulling back against the euro and the pound as protectionist measures on trade from the Trump Administration threaten to upend the global economy. Leaders from the world’s six other wealthiest nations spent the weekend lamenting Trump’s decision to impose steel and aluminum tariffs on allies. He’ll get to face them in Quebec this weekend.

Dollar dips as euro, pound advance

The uncertainty around trade and general dollar weakness is allowing the euro to benefit Monday morning.

EUR/USD traded up around 1.173 earlier Monday morning, but then dipped a bit lower to 1.171 on worse-than-expected producer price index for April. The Eurozone economy has been suffering from slow growth. However, last week we saw better-than expected retail and unemployment numbers out of Germany and a positive industrial confidence index for the Eurozone. The pair is trading up around 1.172 after worse-than-expected U.S. factory orders in April.

The pound jumped higher on better-than-expected construction PMI data for May. The index came out at 52.5 compared to the 52.0 expected. GBP/USD pair tried to regain 1.34 this morning, but has since fallen to just above 1.336.

More like G-6

The world’s group of seven wealthiest nations met in Whistler, Canada this weekend, but the G-7 felt more like a G-6 to some after Trump’s latest tariff announcement at the end of last week.

Finance ministers and central bankers from Canada, France, Italy, Germany, the U.K, and Japan were the ones meeting in Whistler and most of them took time over the weekend to speak out against U.S. trade policy. Treasury Secretary Steven Mnuchin was also at the meeting and said the U.S. objective is fair and balanced tade.

Leaders of the G-7 countries will come face to face with President Trump later this week in Quebec.

In other trade news, China is threatening to withdraw some of the concessions it has made during the past couple months of trade talks if the U.S. moves forward with tariffs.

White House advisor Larry Kudlow has said that the U.S. is simply fighting back against years of trade abuse from Canada, China, and the E.U. – a common line from the Trump Administration.

Light on data

The day is light on economic data, with factory orders for the month of April currently weighing on the dollar. Orders declined 0.8% month over month, compared to a dip of 0.5% expected.

Overnight, Australian retail sales for the month of April surprised, coming out at 0.4% growth compared to 0.2% expected. The AUD/USD pair climbed nearly 100 pips throughout Monday morning, trading up around 0.765.