Dollar Weakens Slightly; Yen & Fed in Focus
The US dollar weakened slightly on Thursday after rallying throughout the week, supported earlier by a weaker yen amid the leadership change in Japan. The Japanese currency briefly touched ¥153 per dollar (an eight-month low) before recovering slightly to ¥152.55, amid speculation that Sanae Takaichi, the new LDP chairwoman, would push for large spending and loose monetary policy. In Europe, political risks in France kept markets cautious, while the protracted US government shutdown added to uncertainty.
In major FX markets, the euro rebounded slightly to around $1.1644 after three days of declines, although it remained negative for the week. The pound was steady at $1.3416, and the Australian dollar strengthened to $0.6608. The New Zealand dollar weakened to near $0.58 after the RBNZ cut interest rates by 50 basis points and opened the door to further easing. The dollar index was around 98.7, relatively flat.
From the US, the Fed minutes emphasized that labor market risks were increasing, making a rate cut appropriate, but caution remains high due to inflation. The market still sees room for two more cuts this year, with an accumulation of around 44 basis points by December. However, data delays due to the shutdown could complicate the Fed's assessment at its October meeting. (az)
Source: Newsmaker.id
