Dollar Slips to 2-Week Low

2025-12-01 03:24 By Judith Sib-at 1 min. read

The dollar index inched down to 99.3 on Monday, its lowest level in two weeks, as investors positioned themselves for a crucial month that could see the Federal Reserve deliver its final rate cut of the year.

Weak economic data and dovish comments from several Fed officials have strengthened expectations of a rate reduction next week, with the implied probability at 87%.

The dollar logged its worst week in four months last week, following a sharp shift in expectations for Fed easing and reports that White House economic adviser Kevin Hassett has emerged as the leading candidate to succeed Jerome Powell as Fed chair, a choice seen as aligned with President Donald Trump’s preference for lower interest rates.

On Sunday, Trump said he has decided on his pick for the next Fed chair and will announce it soon.

Investors are looking ahead to fresh economic data this week, particularly ADP private payrolls and PCE figures, for more clues on the Fed's rate path.



News Stream
DXY Firms After Hot PPI
The dollar index remained above 97.7 on Friday and was largely unchanged for the week, supported by stronger-than-expected inflation that reinforced expectations the Federal Reserve will hold interest rates steady. January’s PPI rose 0.5% month-on-month, up from 0.4% in December and exceeding forecasts of 0.3%, signaling persistent price pressures. Jobless claims data showed both initial and continuing claims below expectations, pointing to a stable US labor market and solid worker retention. Money markets are projecting at least two rate cuts this year, with the first one fully priced in July. Investors also watched potential US tariff increases from 10% to 15% for some countries and ongoing US-Iran nuclear talks set to continue next week. The dollar is on track to finish the month 0.9% higher, ending a three-month losing streak.
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Dollar Steadies Ahead of PPI Data
The dollar Index held arounde 97.8 on Friday, trading sideways throughout the week as investors awaited upcoming inflation data that could shape Federal Reserve policy expectations. January’s PPI report is forecast to show wholesale inflation slowing to 0.3% month-on-month, down from 0.5% in December. Data on Thursday revealed that both initial and continuing jobless claims came in below forecasts, indicating a stable US labor market and ongoing employer retention of workers. The Fed is expected to keep rates on hold at least until June, as policymakers weigh elevated inflation against labor market risks. Investors also monitored uncertainties around US tariffs, following indications from the Trump administration that tariffs for some countries could rise from 10% to 15%, while the US and Iran agreed to continue nuclear negotiations next week. The dollar looks set to end the month higher, snapping a three-month losing streak.
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Dollar Little Changed on Thursday
The dollar index was little changed at 97.7 on Thursday, hovering not far from the one-month highs reached last week, as investors continued to await fresh catalysts after concerns over President Trump’s trade policies eased, though uncertainty still lingers. Sentiment was also weighed down by worries surrounding US-Iran talks. Meanwhile, both initial and continuing jobless claims came in below forecasts, signalling that the US labour market has stabilised and that employers are continuing to retain workers. At the same time, money markets have scaled back expectations for Federal Reserve rate cuts. The probability of a quarter-point reduction by June has fallen to 50%, the lowest level so far this year, while expectations of a third cut by year-end have all but faded.
2026-02-26