A critical week for the future of the dollar

The inflation data to be released in the US this week and the Fed meeting taking place on October 29 hold great importance for the future movements of the dollar.

LMAX Group Currency and Crypto Strategist Joel Kruger emphasized that these two developments will determine the direction of the dollar. Markets expect the Fed to implement a 25 basis point interest rate cut at its meeting.

Kruger stated that the delayed September inflation data will play a critical role ahead of the Fed meeting. He also expressed that policy decisions from other major central banks, such as the Bank of Japan, the European Central Bank, the Bank of Canada, and the Reserve Bank of Australia, could also affect the strength of the dollar.

Stating that tensions between the US and China could lead to volatility in the markets ahead of the APEC summit in South Korea, Kruger suggested that a temporary ceasefire is possible.

BBH analysts, meanwhile, expect the Fed to adopt a more moderate policy toward the end of the year and for this to have a weakening effect on the dollar. While the WSJ Dollar Index showed a slight increase, the dollar gained 0.5 percent against the yen and remained stable against the Euro.

News Source: 12punto