The US Dollar is showing signs of recovery after experiencing losses the previous week. Investor sentiment appears to be shifting as they anticipate upcoming US economic data releases that were delayed. Market expectations for a December rate cut by the Federal Reserve are decreasing, influencing the dollar’s performance against other currencies.
- The dollar index increased above 99.4.
- The September jobs report is due Thursday.
- Markets await an updated timetable for other indicators.
- Key private reports this week include flash S&P PMIs, existing home sales, the NAHB housing index, and the weekly ADP employment aggregate.
- Several Fed officials have expressed doubt about the need for a December rate cut.
- Markets are assigning about a 46% chance of a 25 bps rate cut next month, down sharply from roughly 88% one month earlier.
- The dollar advanced broadly, with the strongest gains coming against the New Zealand and Australian dollars.
These signals suggest a strengthening outlook for the US Dollar. Reduced anticipation of a near-term interest rate cut is likely contributing to increased dollar demand. Furthermore, positive economic data could reinforce the dollar’s upward trajectory.