US dollar steady as Fed signals and data anticipation drive caution – London Business News | Londonlovesbusiness.com

The U.S. dollar remained steady after a strong start to the week.

The dollar could benefit from the pressure on the euro amid concerns over a potential collapse of the French government.

Although the Manufacturing ISM index remained in contraction territory, stronger new orders figures indicated a modest recovery.

This development has reinforced optimism about the resilience of the U.S. economy and may guide the Federal Reserve’s policy decisions in the months ahead.

John Williams, President of the Federal Reserve Bank of New York, adopted a dovish tone yesterday, hinting at the potential for future rate cuts while emphasizing data dependency in decision-making. He expressed optimism about the strong U.S. economy and easing inflation. Meanwhile, Raphael Bostic, President of the Federal Reserve Bank of Atlanta, suggested that rate cuts might not be necessary in the upcoming meeting. The market currently reflects mixed expectations, pricing in a 25-basis-point cut at the next meeting but anticipating a hold in January, which could lend support to the dollar.

Today’s relatively light economic calendar includes private employment data and speeches from Federal Reserve officials. With U.S. Treasury yields showing no decisive movements, the dollar could trade sideways. However, upcoming key economic indicators from both the U.S. and Europe could heighten volatility for the greenback.