SYDNEY/LONDON - The dollar edged higher on Monday after US President Donald Trump warned more tariffs were imminent including on steel and aluminum, although US futures and European stocks shrugged off the looming levies and rose.
Speaking to reporters on Air Force One, Trump said he would announce on Monday 25 percent tariffs on all steel and aluminum imports into the US, and reveal other reciprocal tariffs on Tuesday or Wednesday.
China's retaliatory tariffs on some US exports take effect on Monday, with no sign as yet of progress between Beijing and Washington.
Investors reacted by pushing the dollar slightly higher, with the index tracking the US currency up just over 0.1 percent from Friday's close, at 108.17.
It climbed 0.59 percent against Japan's yen, which had its best week since November last week as investors bet on more Bank of Japan rate hikes. The euro was flat at $1.0329.
The dollar rose against the currencies of commodity-exporting countries before moderating. The Canadian dollar was last around 0.2 percent lower.
"Much uncertainty about the nature, timing and magnitude of these tariffs looks likely to keep the dollar supported this week," said Chris Turner, global head of markets at European bank ING.
Turner also flagged the risk that Trump imposes reciprocal tariffs on many countries, as he said he would on Friday, which could shake currencies around the world.
US stock futures initially fell but quickly recovered as investors looked ahead to another busy week of earnings. S&P 500 contracts were last up 0.35 percent, after the cash index fell 0.95 percent on Friday.
Shares had been roiled by some mixed earnings numbers last week, though overall earnings per share growth is running at 12 percent and above early expectations of 8 percent.
Europe's continent-wide STOXX 600 index rose 0.28 percent in early trading after slipping 0.38 percent on Friday.
The shares of some European steelmakers slipped, including Luxembourg-based ArcelorMittal and Germany's Salzgitter.
Analysts say tariffs could put upward pressure on US inflation and further limit room for the Federal Reserve to ease policy, which has supported the US dollar since Trump's re-election.
Markets had already scaled back expected rate cuts this year to just 36 basis points, from around 42 basis points, following a broadly upbeat payrolls report on Friday.
Fed Chair Jerome Powell is due to appear before the House of Representatives on Tuesday and Wednesday and the impact of tariffs on policy is sure to be a hot-button issue.
US Treasuries fell slightly on Monday, with yields on 10-year notes up 1 basis point at 4.497 percent. Yields move inversely to prices.
Japan's Nikkei stock index was flat.
Gold prices hit another record high at $2,901 an ounce, helped in part by talk Trump might impose tariffs on the metal.
London aluminum traded in a tight range on Monday as investors weighed the possible metals tariffs.
Oil prices ticked up after three weeks of losses that have been partly driven by trade concerns. Brent crude was 0.7 percent higher at $75.19 a barrel.
