Dollar slips as traders eye next week's Fed meeting
The U.S. dollar slipped on Friday but held within recent ranges against major currencies as traders awaited next week's Federal Reserve meeting, where policymakers are widely expected to cut interest rates.
The dollar index , which measures the currency against six peers, was down 0.1% at 98.994, not far from Thursday's five-week low of 98.765. For the week, the index was down 0.5%.
The euro was about flat at $1.16433, not far from Thursday's three-week high of $1.1681.
Traders are pricing a nearly 90% chance of a Fed rate cut next week, and potentially two more reductions next year, LSEG data showed.
"This week, some soft labor market data releases from alternative sources helped crystallize what still appears to be an overdone 90% probability of a cut next week," Antonio Ruggiero, FX & macro strategist at Convera, said.
Morgan Stanley said on Friday it now expects the Fed to deliver a quarter-percentage point rate cut in December, joining peers JPMorgan and BofA Global Research, following dovish remarks from central bank policymakers.
All three brokerages previously expected the Fed to hold rates steady in December.
The yen, which has been supported in recent sessions by expectations that the Bank of Japan could raise rates this month, edged up on Friday, rising 0.1% to 155.295 to the dollar.
BOJ officials are ready to raise rates on December 19 in the absence of any major economic shocks, Bloomberg reported on Friday, a day after Reuters reported three sources as saying a hike this month was likely.
Sterling was about flat on the day at $1.3329, not far from the previous session's six-week peak of $1.3385.
Leading cryptocurrency bitcoin fell for the second straight day, slipping 3% to $89,701.
Source: Reuters.com
