The Dollar Is "Weakening," But Tomorrow Could Be a Big Trigger!
The dollar index fell to 98.2 on Monday after posting a small gain last week. Market movements are expected to be quieter this week due to the Christmas holiday, so trading volume is likely to decrease.
Although the market is relatively calm, market participants remain vigilant for the release of important economic data. The main focus will be on the third-quarter GDP data (preliminary estimate), scheduled for release on Tuesday.
The GDP data is seen as a key indicator of the health of the US economy. This figure could also influence market expectations regarding when the Federal Reserve will make its next interest rate move.
Currently, investors expect the Fed to cut interest rates twice next year. This expectation has strengthened with emerging signs of subdued inflation and a weakening labor market.
The market believes the combination of declining inflation and a weakening labor force could open up room for policy easing. Therefore, Tuesday's GDP data will be crucial in determining whether the "two cuts" narrative remains relevant.
In addition to US data, traders are also paying attention to the movement of the Japanese yen. The yen is being closely monitored after the Bank of Japan raised interest rates last week.
However, BoJ Governor Kazuo Ueda maintained a cautious stance following the hike. This cautious tone has led the market to believe the BoJ's next move will be highly data-dependent, potentially exposing the yen to sensitive fluctuations. (asd)
Source: Newsmaker.id
