FX.co ★ Dollar Languishes at Over 1-Month Low

The dollar index remained below 99 on Thursday, lingering at its lowest point in over a month as increasing signs of a weakening U.S. jobs market bolstered expectations for an anticipated Federal Reserve interest rate cut next week. Data from ADP on Wednesday indicated an unexpected decline of 32,000 in private payrolls, heightening concerns about a more significant downturn in the U.S. labor market. Currently, markets are anticipating an 89% likelihood that the Fed will implement a 25 basis point reduction this month, with projections for three more cuts in the following year. Investors are also evaluating the possibility of White House economic adviser Kevin Hassett replacing Fed Chair Jerome Powell in May, a change that could herald a push for more aggressive monetary easing. On the international front, the dollar is under pressure from a robust euro, buoyed by strong Eurozone business activity data. Additionally, traders are keeping an eye on the yen, which continues to gain ground amid speculation that the Bank of Japan might increase rates later this month.