MARKET OUTLOOK - Expectations of Continued Fed Rate Cuts Weaken the Dollar

Forex - Swissquote Bank analyst Ipek Özkardeskaya stated that the dollar has fallen as investors maintained their bets on a 25 basis point interest rate cut by the Fed in its December meeting following weaker-than-expected U.S. data. Özkardeskaya noted, "Fed Chair Jerome Powell mentioned that the central bank could be 'a bit more cautious' regarding rate cuts, but this did little to convince the market to back off its bets for a rate cut in December." She pointed out that expectations for the Fed are best reflected in the U.S. two-year Treasury yield, which declined after the U.S. ISM services purchasing managers' index and ADP private employment data came in below expectations. The DXY dollar index fell by 0.3% to 106.049.