The Dollar index hovered just above 102.00, near year-to-date levels, as major currency pairs traded in tight ranges. Softer US releases, including the August PCE deflator and the September NFP report, alongside cautious Federal Reserve communication, have cooled expectations of an imminent rate increase and left markets pricing only modest tightening this month.
Focus Shifts To Upcoming CPI Data
Attention now turns to the September US CPI report due on Wednesday, which is expected to test the market’s current assumption that the Fed will stay on hold. Further direction may also come from comments by Fed Chair Kevin Warsh, as traders gauge whether a pause would extend beyond this meeting or precede another move later in the year, with December in focus for a potential hike.
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