"The US dollar slipped to multi-week lows on Tuesday, extending recent weakness as investors positioned for more monetary easing by the Federal Reserve. Rapidly softening labour market data has fuelled bets that the Fed will need to accelerate the pace of its rate cuts, with markets increasingly pricing reductions not only in September but also in October and December. Political pressure added to the dovish tone."
"In a social media post on Monday, President Trump urged Fed Chair Jerome Powell to deliver a "bigger" cut, citing strains in the housing market. The intervention reinforced concerns over the central bank's independence in the aftermath of the legal dispute with Fed Governor Lisa Cook. In the meantime, Treasury yields remained broadly stable, with the 10-year yield holding above 4.0%, but could still come under pressure. Still, bonds could react to today's retail sales data, which is expected to show a 0.3% monthly gain."
The US dollar slipped to multi-week lows as investors repositioned for more Federal Reserve easing. Rapidly softening labour market data increased expectations that the Fed will accelerate rate cuts, with markets pricing reductions in September, October and December. Political pressure intensified after President Trump urged Fed Chair Jerome Powell to deliver a "bigger" cut, citing strains in the housing market, reinforcing concerns about central bank independence after a legal dispute with Fed Governor Lisa Cook. Treasury yields remained broadly stable with the 10-year above 4.0%, but upcoming retail sales could shift bond and dollar sentiment; a softer print would strengthen easing bets and likely weigh on yields and the dollar, while an upside surprise could provide temporary relief.
Read at London Business News | Londonlovesbusiness.com
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