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Dollar Holds Steady Amid Rate Cut Expectations
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New York – the U.S. dollar experienced a period of stabilization Monday, following a significant decline last week triggered by comments from Federal Reserve Chairman Jerome Powell suggesting potential interest rate reductions as early as next month. This shift in sentiment has prompted a reassessment of currency valuations across major markets.
Currency Movements
The euro weakened to $1.1699, a slight decrease from its four-week high of $1.174225 reached on friday. Both the British pound and the Swiss franc also saw a 0.1 percent decline in value. These movements reflect a broader trend of dollar recovery as investors digest the implications of a potentially more dovish Federal Reserve policy.
Mark Chandler, chief market strategist at Bangkarn Global Forex, noted the current market pause. The dollar is holding today in relatively narrow ranges… I think it will take more data… to really influence the Federal Reserve’s expectations,
he stated. This highlights the data-dependent nature of future monetary policy decisions.
Rate Cut Predictions
Several prominent financial institutions, including Barclays, BNP Paribas, and Deutsche Bank, now anticipate a 25 basis point interest rate cut in September. This expectation stems from Powell’s remarks on Friday,where he acknowledged elevated risks in the American job market while together cautioning that inflation remains a concern. The
