Group 1: Dollar Index and Economic Indicators - The dollar index (DXY00) increased by +0.25% due to the unexpected rise in the Nov Empire manufacturing general business conditions survey, reaching a 1-year high [1][2] - The Nov Empire manufacturing survey rose by +8.0 to a level of 18.7, significantly stronger than the expected decline to 5.8 [2] - The probability of a Fed rate cut at the upcoming FOMC meeting decreased to 41% from 70% earlier in the month, influenced by comments from Fed presidents favoring steady interest rates [1][3] Group 2: Euro and ECB Insights - The EUR/USD pair declined by -0.30% as the euro faced pressure from a stronger dollar and comments from ECB Vice President Luis de Guindos regarding elevated financial stability risks in the Eurozone [4][6] - The European Commission raised its 2025 Eurozone GDP forecast to +1.3% from +0.9%, while maintaining the inflation forecast at +2.1% [5] - The ECB is perceived to be nearing the end of its rate-cut cycle, contrasting with the Fed's expected rate cuts through the end of 2026 [5] Group 3: Japanese Economy and Yen Performance - The USD/JPY pair increased by +0.21% as the yen was pressured by news of a significant contraction in the Japanese economy in Q3, prompting discussions for an ambitious stimulus package [7] - An upward revision to Japan's September industrial production provided some support for the yen [7] - The yield on the 10-year Japanese government bond rose to a 17-year high of 1.737%, which is supportive for the yen [7]

Group 1 - The dollar index (DXY) increased by +0.13% on Friday, recovering from a two-week low, driven by hawkish comments from Kansas City Fed President Jeff Schmid and Dallas Fed President Lorie Logan against further Fed rate cuts [1][2][3] - The probability of a Fed rate cut at the next FOMC meeting decreased from 70% to 42% following statements from several Fed presidents favoring steady interest rates [2][3] - The euro (EUR/USD) fell by -0.12% on Friday, influenced by the dollar's strength, although losses were mitigated by an upward revision of Eurozone Q3 GDP to +1.4% y/y from +1.3% y/y [4][5] Group 2 - The Japanese yen (USD/JPY) experienced a slight decline of -0.01% on Friday, despite modest gains supported by Japan's September tertiary industry index showing its largest increase in four months and rising government bond yields [6]

Group 1: Dollar Index and Economic Indicators - The dollar index (DXY00) rose by +0.06% on Wednesday, supported by hawkish comments from Atlanta Fed President Bostic, who favors keeping interest rates steady [1] - The dollar is under pressure due to signs of a potential resolution to the US government shutdown, with the Senate passing a temporary continuing resolution [2] - The markets are pricing in a 64% chance that the FOMC will cut the fed funds target range by 25 basis points at the next meeting on December 9-10 [3] Group 2: Euro and ECB Commentary - The EUR/USD rose by +0.06% on Wednesday, driven by hawkish comments from ECB Executive Board member Schnabel, who stated that interest rates are "absolutely" in a good place [4] - Central bank divergence is supportive of the euro, as the ECB is seen as largely finished with its rate-cut cycle, while the Fed is expected to cut rates several more times by the end of 2026 [4] - Schnabel indicated that there is positive momentum in the Eurozone economy and inflation risks are slightly tilted to the upside, with swaps pricing in a 4% chance of a -25 basis point rate cut by the ECB at the December 18 policy meeting [5]

Group 1 - The dollar index (DXY) fell by -0.04% after reaching a 1-week high, influenced by a potential US export restriction to China and the ongoing US government shutdown [1] - The British pound weakened, leading to a decline in GBP/USD to a 1-week low, which may prompt the Bank of England to consider interest rate cuts [2] - The markets are anticipating a 97% probability of a -25 basis point rate cut at the upcoming FOMC meeting on October 28-29 [3] Group 2 - The euro (EUR/USD) recovered from a 1-week low, finishing up by +0.09%, supported by short covering and hawkish comments from ECB Vice President Guindos [3] - Guindos stated that the current ECB interest-rate level is adequate, with balanced risks to consumer-price growth, and swaps indicate a 2% chance of a -25 basis point rate cut at the ECB's October 30 meeting [4] - The USD/JPY fell by -0.01%, with Japanese trade data showing increased exports and imports, although concerns about the new Prime Minister's monetary policy stance limit yen gains [5]

Group 1: Dollar Index and Economic Factors - The dollar index (DXY00) is up by +0.07% at a 1-week high, supported by weakness in the British pound following a weaker-than-expected UK September CPI report [1] - US-China trade tensions have eased, contributing to dollar strength after President Trump expressed optimism about relations with China [1] - Ongoing US government shutdown poses a bearish outlook for the dollar, with potential implications for the US economy and Federal Reserve interest rate cuts [1] Group 2: Euro and ECB Insights - The markets are pricing in a 97% chance of a -25 basis point rate cut at the next FOMC meeting on October 28-29 [2] - The euro (EUR/USD) is down by -0.05% at a 1-week low, influenced by dollar strength and a budget impasse in France [2] - ECB Vice President Guindos stated that the current ECB interest-rate level is "adequate," providing some support to the euro despite the bearish sentiment [2][3] Group 3: Japanese Yen and Trade Data - The USD/JPY is up by +0.01%, with the yen remaining relatively unchanged [4] - Japanese trade data shows September exports rose by +4.2% year-on-year, the largest increase in seven months, while imports rose by +3.3% year-on-year, exceeding expectations [5] - Concerns about new Japanese Prime Minister Takaichi advocating for a less hawkish monetary policy may limit gains in the yen [4]

Group 1: Dollar Index and US Labor Market - The dollar index (DXY00) recovered from early losses and is up by +0.23%, supported by higher T-note yields which strengthened the dollar's interest rate differentials [1] - The dollar initially declined due to the US government shutdown and signs of weakness in the labor market, with a report indicating that US employers have cut the most jobs this year since 2020 [2] - US September Challenger job cuts fell by 25.8% year-on-year to 54,064, with a total of 946,426 job cuts announced this year, the highest for the same period since 2020 [3] Group 2: Eurozone Economic Indicators - The EUR/USD pair is down by -0.17%, influenced by the dollar's rebound and an unexpected increase in the Eurozone's August unemployment rate [4] - The Eurozone's August unemployment rate rose by +0.1 to 6.3%, indicating a weaker labor market than expected [5] - ECB Governing Council member Kazaks stated that current ECB interest rates are appropriate, suggesting a pause in rate cuts [6] Group 3: Japanese Yen and Economic Outlook - The USD/JPY pair is up by +0.09%, with the yen losing overnight gains as T-note yields rose [7] - The Japanese consumer confidence index for September rose to a 9-month high, initially supporting the yen [7] - BOJ Deputy Governor Uchida indicated that the BOJ will continue to raise interest rates if the economic outlook improves, pushing the Japanese 10-year bond yield to a 17-year high of 1.674% [7]

Core Points - The dollar index fell by -0.31% from a one-week high, influenced by expectations of easier Federal Reserve policy and a potential 50 basis point interest rate cut this year [1] - Support for the dollar was provided by hawkish comments from several Federal Reserve presidents, indicating limited room for further interest rate cuts [1][3][4] Group 1: Federal Reserve Outlook - The Federal Open Market Committee (FOMC) is expected to cut interest rates by another 50 basis points this year, with a 90% chance of a 25 basis point cut at the next meeting on October 28-29 [1][4] - St. Louis Fed President Alberto Musalem noted limited room for additional rate cuts due to elevated inflation, suggesting current rates are "between modestly restrictive and neutral" [3] - Atlanta Fed President Raphael Bostic expressed concerns about elevated inflation, stating he does not foresee inflation returning to 2% until 2028 [3] Group 2: Dollar Weakness and Market Reactions - Concerns over the independence of the Federal Reserve, particularly regarding President Trump's attempts to influence Fed governance, may lead foreign investors to sell dollar assets [2] - The euro gained strength, rising by +0.43%, supported by dollar weakness and positive developments such as Fitch Ratings upgrading Italy's sovereign credit rating [5] - Central bank divergence is evident, with the European Central Bank (ECB) seen as nearing the end of its rate-cut cycle, while the Fed is expected to implement further cuts [6]

Core Viewpoint - The dollar index is experiencing downward pressure due to expectations of easier Federal Reserve policy, with a potential interest rate cut of 50 basis points anticipated this year [1][2]. Group 1: Federal Reserve Outlook - The dollar index (DXY00) fell by -0.12% from a one-week high, influenced by the outlook for easier Fed policy [1]. - The FOMC is expected to cut interest rates by another 50 basis points this year, with a 92% chance of a -25 basis point cut at the next meeting on October 28-29 [4]. - St. Louis Fed President Alberto Musalem and Atlanta Fed President Raphael Bostic expressed limited room for further rate cuts due to elevated inflation concerns [3][4]. Group 2: Market Reactions - The euro is gaining support from the dollar's weakness, with EUR/USD rising by +0.19% [4]. - Fitch Ratings upgraded Italy's sovereign credit rating, which positively impacted the euro [4][5]. - The Eurozone's September consumer confidence index rose by +0.6 to -14.9, exceeding expectations [5]. Group 3: Currency Movements - The USD/JPY pair decreased by -0.03%, with the yen recovering from a two-week low due to a weaker dollar [6]. - Higher Japanese government bond yields, reaching a 17-year high of 1.670%, have strengthened the yen's interest rate differentials [6].

Group 1: Dollar Index and Market Reactions - The dollar index (DXY00) is up by +0.07%, with modest gains observed ahead of the FOMC meeting results [1] - Weakness in stocks is increasing liquidity demand for the dollar, although gains are muted following disappointing housing data [1] - The market is pricing in a 100% chance of a -25 basis point (bp) rate cut at the FOMC meeting, with an 86% chance of a second -25 bp cut at the next meeting [5] Group 2: Housing Market Data - US August housing starts fell by -8.5% month-over-month (m/m) to 1.307 million, below expectations of 1.365 million [4] - Building permits for August unexpectedly fell by -3.7% m/m to a 5.25-year low of 1.312 million, contrary to expectations of an increase to 1.370 million [4] Group 3: Federal Reserve and Interest Rate Expectations - The dollar is under pressure due to expectations for the Fed to cut interest rates by -25 bp at the conclusion of the FOMC meeting [2] - Concerns over Fed independence may lead to foreign investors selling dollar assets, particularly in light of political tensions surrounding Fed leadership [3] - The markets are anticipating an overall -69 bp cut in the federal funds rate by year-end, reducing it from the current 4.33% to 3.64% [5] Group 4: Eurozone Economic Indicators - The euro is down by -0.09% as the strength of the dollar weighs on it, compounded by a downward revision to Eurozone August CPI [6] - Eurozone August CPI was revised lower to +2.0% year-over-year (y/y) from +2.1% y/y, while core CPI remains unchanged at +2.3% y/y [7] - Swaps indicate a 2% chance of a -25 bp rate cut by the ECB at the upcoming policy meeting [7]

Group 1 - The dollar index fell by -0.69%, reaching a 2.5-month low, primarily due to expectations of a -25 basis point interest rate cut by the Fed [1] - US retail sales in August rose by +0.6% month-over-month, exceeding expectations of +0.2%, while retail sales excluding autos increased by +0.7% month-over-month, stronger than the anticipated +0.4% [3] - The markets are pricing in a 100% chance of a -25 basis point rate cut at the upcoming FOMC meeting, with an overall expectation of a -68 basis point reduction in the federal funds rate by year-end [5] Group 2 - Concerns over Fed independence are affecting the dollar, as President Trump attempts to fire Fed Governor Cook, which may lead foreign investors to sell dollar assets [2] - The euro rose by +0.88%, reaching a 4-year high, supported by dollar weakness and central bank divergence, with the ECB seen as nearing the end of its rate-cutting cycle [6] - The US manufacturing production unexpectedly increased by +0.2% month-over-month, contrary to expectations of a -0.2% decline [3]