By Chibuike Oguh and Canan Sevgili NEW YORK/LONDON (Reuters) -The U.S. dollar held steady against major peers on Tuesday as investors weighed commentary from Federal Reserve officials including Chair Jerome Powell, while the Swedish krona gained after the Riksbank delivered a hawkish 25-basis-point rate cut. The dollar was down 0.11% at 0.791 against the Swiss franc The euro was up slightly by 0.08% at $1.1812 while sterling was flat at $1.3517. Powell said the central bank needed to continue balancing ...

Core Viewpoint - The U.S. Federal Reserve has cut interest rates by 25 basis points, indicating a shift in their outlook on inflation and trade policies, which has led to fluctuations in the U.S. dollar against the euro and other currencies [1][2][4]. Group 1: Federal Reserve Actions - The Federal Reserve's recent rate cut is the first since December, lowering the policy rate to a range of 4.00%-4.25% [4]. - Projections suggest that two additional quarter-percentage-point cuts are expected at the remaining policy meetings this year, reflecting a more dovish stance from Fed officials [2][3]. - Fed Chair Jerome Powell described the rate cut as a risk management decision, emphasizing a cautious approach to future rate changes [5]. Group 2: Market Reactions - Following the rate cut, the U.S. dollar initially fell to a four-year low against the euro but later recovered, trading higher during a volatile session [1]. - The euro reached its highest level since June 2021 at $1.19185 before settling lower at $1.18305 against the dollar [6]. - The dollar index, which measures the U.S. currency against six others, increased by 0.3% to 96.926 [6]. Group 3: Economic Indicators - Data released indicated a decline in U.S. single-family homebuilding and permits for future construction in August, attributed to a surplus of unsold new houses and a weakening labor market [6]. - Analysts suggest that while the dollar may face further losses, external global economic conditions will also play a significant role in its performance [7].

Group 1 - The U.S. dollar has fallen to a four-year low against the euro, driven by expectations of a Federal Reserve interest rate cut this week [1][2] - The euro increased by 0.9% to $1.1867, marking its highest level since September 2021, while the U.S. dollar index dropped 0.7% to 96.636, the lowest since July 1 [1][2] - Investors are anticipating a 25-basis-point rate cut by the Fed, influenced by softening labor market data [2][3] Group 2 - The dollar is under pressure as investors expect a dovish message from the Fed, with a focus on supporting labor markets [3][4] - Fed Chair Jerome Powell is scheduled to hold a press conference following the release of the Fed's policy statement [3] - Despite a rise in U.S. retail sales in August, concerns about economic growth persist due to labor market weakness and rising goods prices from tariffs [5][6] Group 3 - The Bank of England may ease concerns about inflation as the U.K. jobs market shows signs of slowing, with wage growth decreasing to 4.7% [6][7] - The number of workers on payrolls in the U.K. has fallen for seven consecutive months, indicating potential economic challenges [7]