Dollar index slips to 101.1 as softer inflation supports October Fed pause bets

  • Dollar index fell to 101.1 on Wednesday as softer inflation supported an October Fed pause.
  • PCE rose 0.3% month on month, while core PCE increased 0.2%.
  • Government payrolls data due Friday is expected to show a 90,000 increase before October 28.

The dollar index fell to 101.1 on Wednesday after softer-than-expected inflation strengthened expectations that the Federal Reserve may keep interest rates unchanged at its October meeting. The headline PCE price index rose 0.3% month on month, while core PCE, which excludes food and energy, increased 0.2%. Consumer spending remained resilient as households continued buying vehicles, furnishings and clothing despite elevated gasoline and other costs. Revised figures showed second-quarter GDP growth at 2.2%, up from 1.5%, while first-quarter growth was also revised higher. Stronger hiring by U.S. companies in September further suggested that economic activity remained relatively firm. The government employment report due Friday is expected to show a 90,000 increase in payrolls and will provide another key input for the Federal Reserve before its October 28 meeting. Despite Wednesday’s decline, the dollar has gained more than 1.5% in September and was little changed over the third quarter.

The information on this website is generated using AI and we cannot guarantee its accuracy. Please use it as reference information only.