The Dollar strengthened on Wednesday but was still set for its weakest monthly performance since November 2022, as investors flocked to perceived safe-haven assets amid concerns over US trade policies under President Donald Trump.

The Euro, slightly weaker at $1.1372 after a 0.33% drop the day before, has gained more than 5% in April, positioning it for its strongest monthly performance since November 2022, as investors shifted away from US assets.

Data released on Wednesday showed that Germany’s GDP grew as expected, while France’s annual inflation rate surpassed forecasts in April, and French GDP saw a slight increase.

However, these reports had little impact, with market focus firmly on US GDP data due later in the day and nonfarm payrolls on Friday, which are expected to provide clearer insight into the future of the world’s largest economy, Reuters reports.

The White House has backtracked multiple times on the sweeping tariffs that Trump introduced in early April, which triggered a global stock market crash and caused investors to abandon the traditionally safe-haven US Dollar and Treasury bonds.

“We've reached a level in the US Dollar where the market is getting more cautious about further Dollar weakness ... until we get further messages ... it's a little hard to assess,” stated Commerzbank FX analyst Michael Pfister

On Tuesday, Trump signed two executive orders aimed at easing the impact of his auto tariffs, offering a combination of credits and relief from other material levies. Trump’s trade team also highlighted their first deal with a foreign trading partner.

US Treasury Secretary Scott Bessent stated that the administration is making headway on tariff negotiations, with agreements expected soon with India and South Korea.

These developments helped alleviate some concerns as investors and businesses remain anxious about the economic impact of the tariffs. There are signs that the duties could hinder growth, potentially leading to higher inflation and rising unemployment.

“We estimate 'peak tariff' has passed. However, damage has been done to confidence, the US economy and the global trading system,” according to Kristina Clifton, a Commonwealth Bank of Australia economist.

In addition, the Swiss Franc was down 0.3% at 0.8258 per Dollar, but it is on track for a 6.9% increase this month, marking its strongest performance in over a decade. Meanwhile, the Yen weakened slightly to 142.82 per Dollar ahead of the Bank of Japan's policy decision on Thursday, where the central bank is expected to maintain interest rates. The yen gained nearly 5% against the dollar in April, which is its best monthly performance since last July.

All eyes will now be on the advance GDP estimate for the January-March quarter, set to be released on Wednesday, coinciding with Trump’s 100th day in office.

The US personal consumption expenditure report, the Federal Reserve's favoured inflation measure, will also be in the spotlight, set to be released later in the day.

Elsewhere, the Australian Dollar rose by 0.1%, reaching $0.6389. Meanwhile, the British pound stood at $1.3375, on track for a 3.5% gain in April, its strongest monthly performance since November 2023.