"The greenback could remain exposed to changing monetary policy expectations as markets react to new data and Fed comments. While several Fed members mentioned a cautious approach, Chicago Fed President Austan Goolsbee suggested that multiple rate cuts may be appropriate this year."
"The dollar could find some underlying stability in continued labour market resilience. Initial jobless claims rose modestly but remained below expectations and well under historical averages. Meanwhile, continuing claims declined."
"Confirmation of easing inflation would reinforce the downward bias in yields and weigh further on the dollar. However, any upside surprise could quickly reprice rate expectations, reviving support for yields and the greenback."
The dollar is holding steady within a consolidation range while remaining sensitive to shifting monetary policy expectations. Fed communications show mixed signals, with some members advocating caution while Chicago Fed President Austan Goolsbee indicated multiple rate cuts may be warranted this year. Markets currently price two cuts as the base case. The labor market provides underlying support for the dollar, with initial jobless claims rising modestly but staying below expectations and historical averages, while continuing claims declined. Producer price data represents the next critical inflection point that could significantly impact dollar direction and yield expectations.
Read at London Business News | Londonlovesbusiness.com
Unable to calculate read time
Collection
[
|
...
]