Dollar Slips on Signs of US Labor Market Weakness

Economic Indicators - The dollar index fell by -0.04% after reaching a 5.5-month high, influenced by mixed economic data [1] - US September nonfarm payrolls increased by +119,000, surpassing expectations of +51,000, indicating a stronger labor market [3] - The September unemployment rate unexpectedly rose by +0.1% to 4.4%, the highest in nearly four years, suggesting some weakness in the labor market [3] - Weekly initial unemployment claims decreased by -8,000 to 220,000, better than the expected 227,000, while continuing claims rose to 1.974 million, the highest in four years [2] - October existing home sales rose by +1.2% month-over-month to 4.10 million, exceeding expectations of 4.08 million [4] Federal Reserve Outlook - Market expectations indicate a 39% chance that the Federal Open Market Committee (FOMC) will cut the fed funds target range by 25 basis points at the next meeting on December 9-10 [4] - Cleveland Fed President Beth Hammack expressed concerns that lowering interest rates could prolong elevated inflation and encourage risk-taking in financial markets, which supports a hawkish stance [4] Eurozone Context - The EUR/USD pair fell by -0.04%, reaching a two-week low, influenced by a weaker-than-expected Eurozone consumer confidence index [5] - The European Central Bank (ECB) is perceived to be nearing the end of its rate-cutting cycle, contrasting with the Fed's expected rate cuts through the end of 2026 [5]