"The US dollar could remain under pressure on Tuesday, and traded near seven-week lows as concerns over labour market weakness reinforced expectations of more aggressive Federal Reserve easing. Traders could remain cautious ahead of inflation data and payroll revisions, with estimates pointing to a downward adjustment of up to 800,000 jobs for the April 2024-March 2025 period. Such revisions would strengthen the narrative of a cooling labour market and cement the case for further policy accommodation."
"Market pricing reflects this view, with almost 90% odds of a 25-basis-point cut at next week's Fed meeting. Treasury yields recovered slightly but remained on a downward slope. Investors continue to price in multiple cuts over the coming months, leaving the curve vulnerable to renewed declines if upcoming inflation releases surprise to the downside. Wednesday's PPI and Thursday's CPI will be pivotal in shaping near-term sentiment."
The US dollar traded near seven-week lows as concerns about labour market weakness reinforced expectations of more aggressive Federal Reserve easing. Traders remained cautious ahead of inflation data and payroll revisions, with estimates suggesting a downward adjustment of up to 800,000 jobs for the April 2024-March 2025 period. Such revisions would strengthen the narrative of a cooling labour market and support further policy accommodation. Market pricing signalled almost 90% odds of a 25-basis-point cut at next week's Fed meeting. Treasury yields recovered slightly but stayed on a downward trajectory as investors priced multiple cuts. Upcoming PPI and CPI readings will be pivotal for near-term sentiment.
Read at London Business News | Londonlovesbusiness.com
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