Dollar rises against euro amid Fed rate cut speculation
The dollar gained on the euro and was roughly flat against the yen on Friday as stocks recovered from a sharp selloff and traders weighed whether the Federal Reserve is likely to cut rates in December.
A flood of data that was delayed during the federal government shutdown is pending release starting next week.
Risk sentiment has been dented by concerns about lofty stock valuations and Fed policy, but the S&P 500 and Nasdaq Composite stock indexes rebounded on Friday. The greenback had weakened on Thursday even as stocks dropped and Treasury yields climbed.
More Fed officials have signalled caution over further easing, citing worries about inflation. Fed funds futures are pricing in only a 41% chance of a 25-basis-point cut in December.
The dollar index , which measures the greenback against a basket of currencies including the yen and the euro, rose 0.07% to 99.31, with the euro down 0.12% at $1.1617.
Against the Japanese yen , the dollar weakened 0.02% to 154.52.
The pound tumbled against both the dollar and the euro after media reports, including from Reuters, that British Prime Minister Keir Starmer and Finance Minister Rachel Reeves have abandoned plans to raise income tax rates, marking a sharp shift just weeks ahead of the November 26 budget.
The British currency was last down 0.24% at $1.3158. The euro hit its highest rate to the pound since April 2023. ,
Against the Swiss franc, the dollar strengthened 0.15% to 0.794. It earlier weakened to a one-month low of 0.7876 as traders rushed into the safe haven Swiss currency.
The Swiss government also said on Friday that the United States will slash its tariffs on goods from Switzerland to 15% from a crippling 39% under a new framework trade agreement.
In cryptocurrencies, bitcoin fell 3.41% to $95,433, the lowest since May.
Source: Reuters
