Dollar slips but set for strongest monthly gain in over two years

The dollar dipped to 103.9 on Thursday but remains on track to close October with a 3% gain, marking its most robust monthly increase over two years.

Dollar slips but set for most substantial monthly gain in over two years

Recent data has bolstered expectations that the Fed may be more cautious about rate cuts. The U.S. economy grew at an annualized 2.8% in Q3, just below the 3% forecast, yet robust personal spending and sales data highlighted strong consumer demand. Meanwhile, PCE prices rose as anticipated, and the annual core rate held steady. Labor market indicators remained robust, with the ADP report showing a surge in private employment for October, and initial claims fell to their lowest since May 2021.

Traders eye fed rate cuts; election uncertainty pressures dollar

With the payrolls report set for release tomorrow, traders anticipate a 25 basis point cut at next week’s Fed meeting and a 72% chance of another cut in December. Uncertain uncertainty around a potential Trump victory in the upcoming presidential election also weighed down the dollar.