"The dollar posted modest gains on Wednesday, underpinned by a broad rise in Treasury yields. The 10-year yield stabilized after touching multi-month lows in the previous session, offering support to the greenback. Markets are in wait-and-see mode ahead of the release of the Federal Reserve minutes, which could set the tone for the next few days. The backdrop remains mixed as labour market resilience contrasts with softer inflation readings, keeping the path of policy rates in doubt."
"The uncertainty could leave the market without a clear direction. Recent Fed commentary has reinforced that ambiguity. Fed Governor Michael Barr suggested policy may need to remain steady while incoming data are assessed. In contrast, Chicago Fed President Austan Goolsbee indicated that additional cuts could be justified if inflation convincingly trends back toward 2%. Looking ahead, all eyes are on the upcoming PCE inflation and GDP figures due Friday. Evidence of persistent price pressures and economic strength would validate higher yields and extend dollar support."
The dollar posted modest gains supported by a broad rise in Treasury yields, with the 10-year yield stabilizing after touching multi-month lows. Markets remain cautious ahead of Federal Reserve minutes that could influence short-term direction. The economic backdrop is mixed: labour market resilience contrasts with softer inflation readings, creating uncertainty about the policy rate path. Recent Fed comments amplified ambiguity, with Governor Michael Barr indicating policy may need to stay steady while data are assessed and Chicago Fed President Austan Goolsbee saying additional cuts could be justified if inflation returns to 2%. Upcoming PCE and GDP releases will likely determine yield and dollar trajectories.
Read at London Business News | Londonlovesbusiness.com
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