The U.S. dollar hovered near a three-month peak on Monday as investors awaited critical U.S. economic releases. These data points are seen as decisive for the Federal Reserve’s next move on interest rates.
Markets have scaled back expectations for a December rate cut following a recent 25-basis-point reduction and hawkish commentary from the Fed.
Currency insiders note the yen remained near an eight-and-a-half-month low due to a wide interest-rate gap with the U.S., while the euro hit a three-month trough.
The full U.S. jobs report is delayed amid the government shutdown. Instead, traders are focusing on private indicators including the ADP Research Institute employment figure and the Institute for Supply Management (ISM) manufacturing surveys.
With economic data scarce, one FX strategist observed the market is calm for now but warned: “A big surprise — up or down — could quickly shift the trend.”
