Dollar steadies as rate hike expectations fall
The US dollar stopped declining against major currencies, remaining around the 99.00 level as the US labor market awaits August data, which includes non-farm employment figures, the unemployment rate, and workers' wages, with a focus on wage-related inflation. The report's expectations indicate an increase of 56,000 non-farm jobs, while the unemployment rate is expected to stay steady at 4.1%. Inflation expectations and the risks of interest rate hikes have reduced the likelihood of future rate increases, with the chances of a hike in the upcoming meeting dropping to 50% from 63% previously. Additionally, statements by Federal Reserve officials have dampened demand for the dollar, with only limited recovery seen in the USD-JPY pair. Overall, the market is awaiting upcoming data to inform future monetary policy decisions.
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