The Dollar Index has fallen nearly 1% over two days, moving away from the April 2025 immediate post-tariff board highs, after comments at an IMF meeting in Bangkok were taken as lacking a hawkish lean. Rate pricing shifted quickly: implied probabilities of a hike, which had moved into the high-20s percent range after the CPI, dropped below 15% following the remarks. The dollar weakened further and equity futures strengthened.
Forward rate expectations also eased, with traders moving away from a 5% base rate a year ahead towards a 4.5–4.75% range. For Q4, attention is on the Fed’s October decision and guidance; a pushback against December hike pricing is framed as triggering a USD correction, while further tightening is associated with DXY at 102.50–103.00. Subsequent US labour market and inflation data through November will test whether the September CPI was an energy-driven spike or a persistent trend, while cross-asset moves such as equity volatility and gilt/Treasury yield spreads may shape GBP and EUR performance.
Financial Markets Rate Cut and Options Strategy
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Historical Statistics and Volatility Benchmarks
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