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2025-09-16 16:31:59
[US Dollar Falls to Multi-Month Low, Awaiting Fed Decision] ⑴ The US dollar fell to over two-month lows against the euro and pound, and hit a new 10-month low against the Australian dollar, as investors reinforced expectations of a Fed rate cut this week. The US dollar index hit a low of 97.121, its weakest since July 7th, as US President Trump again called for aggressive easing. ⑵ The market generally expects the Fed to cut interest rates by 25 basis points on Wednesday, primarily driven by recent weakening labor market data. Trump urged Powell on social media on Monday to "go deeper," citing the housing market as an excuse. ⑶ Jefferies strategists pointed out that the key will depend on Powell's wording; if he emphasizes inflation risks or uncertainties in the growth outlook, the market may reduce some of its bets on a rate cut. ⑷ The British pound rose 0.2% to 1.3627 against the US dollar, reaching a new high since July 8th. Official UK data showed that corporate payrolls fell for the seventh consecutive month, with the growth rate of basic wages in the private sector slowing from 4.8% to 4.7%. This may ease the Bank of England's concerns about sticky inflation, and the market expects the Bank of England to keep interest rates unchanged on Thursday. (5) The euro rose 0.3% against the dollar to 1.1797, its highest level since July 3rd. Germany's ZEW survey, as well as eurozone wage and industrial output data, will be released later. (6) The Australian dollar edged down to 0.6666 after hitting a high of 0.6677 on November 8th. The dollar fell 0.3% against the yen to 146.92. Markets expect the Bank of Japan to maintain its interest rate at 0.5% on Friday. The Liberal Democratic Party presidential race intensified with the entry of the agriculture minister and chief cabinet secretary.
