Dollar still near 2-week highs as US economic data looms

(MENAFN) In early trading on Tuesday, the U.S. dollar held close to a two-week high against both the yen and the euro, as investors awaited crucial U.S. economic data that could influence the anticipated interest rate cut. The euro was trading at USD1.1060, not far from the two-week low of USD1.1042 it reached in the previous session. The yen fell to USD147.10, approaching its two-week low of USD147.16 hit on Monday. Market participants are particularly focused on the upcoming U.S. jobs data due on Friday, which will be pivotal in shaping expectations for an interest rate cut.

Federal Reserve Chairman Jerome Powell’s recent statements have set the stage for potential rate cuts, driven by concerns over the labor market. Investors are also keeping a close eye on the job openings data to be released on Wednesday and the unemployment claims report on Thursday. According to the CME Group’s FedWatch tool, there is a 69 percent probability that the Federal Reserve will implement a 25 basis point rate cut at its meeting on September 17-18, with a 31 percent chance of a 50 basis point reduction.

The dollar index, which tracks the performance of the U.S. currency against six major counterparts, fell to 101.69 in early trading, just below the two-week high of 101.79 reached on Monday. The index had declined by 2.2 percent in August amid speculation about a forthcoming rate cut. In other currency movements, the British pound dipped slightly to USD1.31425, while the Australian dollar decreased by 0.14 percent to USD0.6782 and the New Zealand dollar fell by 0.18 percent to USD0.6223. 

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