FX.co ★ US Dollar Index Holds Near 1-Month Low

The dollar index lingered below 99 on Friday, matching a one-month low, as anticipation of further rate cuts by the Federal Reserve contrasted with stances from other central banks. Market expectations for a 25 basis point reduction by the Fed in its December meeting remained firm, particularly following a series of disappointing labor market indicators and dovish comments from FOMC Governor Christopher Waller and New York Fed President John Williams. Notably, the ADP data unexpectedly indicated a decline in private sector employment in November, while unemployment claims stayed near four-year highs. Meanwhile, the University of Michigan consumer confidence survey revealed persistent pessimism regarding labor market prospects, despite minor improvements, and the lack of upward surprises in September's PCE price index supported the dovish viewpoint within the FOMC. In contrast, the European Central Bank showed some alignment in maintaining stable rates due to inflation risks, while the Bank of Japan indicated intentions to implement a rate hike this month.