The dollar index (DXY00) today is down by -0.08%. The dollar is slightly lower today as strength in the yen sparked long liquidation in the dollar. Losses in the dollar are limited by higher T-note yields and weakness in stocks, which boosts liquidity demand for the dollar. The dollar also has carryover support from last Friday’s stronger-than-expected US payroll report that eliminated the odds of a 50 bp Fed rate cut at next month’s FOMC meeting.
The markets are discounting the chances at 88% for a -25 bp rate cut at the November 6-7 FOMC meeting and at 0% for a -50 bp rate cut at that meeting.
