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Compared to its competitors, the US dollar is trading softly and appears to be consolidating its gains from the previous session. At 3.7% YoY, the Core PCE for September fell short of forecasts.
US bond yields are fluctuating, and dovish Fed bets are still very popular. The FOMC decision is now the main focus for next week. The US Dollar Index (DXY), which measures the value of the US dollar, dropped to 106.35, which is close to the 20-day Simple Moving Average (SMA). This week will probably end with a gain for the USD.
In terms of data, September’s Personal Consumption Expenditures (PCE) figures were expected, and following three days of gains, investors appear to be taking a profit.
The most recent set of economic activity data, which included an initial estimate of the Q3 GDP growing at an annualised rate of more than 4%, demonstrated how robust the US economy is. Investors are now focused on the Fed’s decision on November 1st of next week in order to get more information about the bank’s future moves.
Daily Digest Market Movers: September PCE slowdown and mixed yields lead to a decline in the US dollar. The US DXY index dropped to 106.35, down 0.25% from the previous three sessions’ gains of almost 1%.
According to the US Bureau of Economic Analysis, the headline PCE Price Index for September was in line with expectations. Compared to the expected 3.4%, it came in at 3.4% YoY and revealed no changes regarding
According to additional data, the Michigan Consumer Index exceeded expectations, coming in at 63.8 instead of the predicted 68, but the Greenback did not significantly react.
US Treasury yields are currently mixed. The 5-year yield is 4.85%, while the 10-year yield is 4.79%. The 2-year rate is currently at 5.03%. Markets have essentially priced in a pause for the Fed’s decision next week, but Chair Powell’s remarks and the monetary policy statement will be closely monitored to set up the next meeting in December. The odds on a hike at the final meeting of the year dropped to almost 20%.
