Dollar Recovers Early Losses as Bond Yields Rise

Group 1: Dollar Index and Economic Indicators - The dollar index (DXY00) rose by +0.02% on Friday, recovering from early losses due to reduced liquidity demand from a rally in stocks and higher T-note yields [1] - US personal spending in September increased by +0.3% month-over-month, aligning with expectations, while personal income rose by +0.4% month-over-month, surpassing the expected +0.3% [3] - The University of Michigan's US December consumer sentiment index increased by +2.3 points to 53.3, exceeding expectations of 52.0 [3] Group 2: Inflation Expectations and Federal Reserve - The University of Michigan's December 1-year inflation expectations eased to 4.1%, better than the expected no change at 4.5%, marking the smallest pace of increase in 11 months [4] - The markets are pricing in a 95% chance that the FOMC will cut the fed funds target range by 25 basis points at the upcoming meeting on December 9-10 [4] Group 3: Euro and Economic News - The EUR/USD fell by -0.03% on Friday, as the euro lost modest gains after the dollar's recovery, despite initial strength from positive Eurozone economic news [5] - Eurozone Q3 GDP was upwardly revised, and German October factory orders reported stronger-than-expected results, contributing to the euro's initial strength [5]