Dollar Near Three‑Month High Amid Fed Uncertainty

The U.S. dollar has strengthened to near three‑month highs as markets pare back expectations of a December Federal Reserve rate cut and await private economic data while a U.S. government shutdown delays official releases. The yen is near an 8½‑month low after the Bank of Japan delivered a dovish hold and Governor Ueda’s guarded comments, prompting intervention jitters as verbal efforts have so far failed to stem the slide. Fed officials remain divided following last week’s 25 basis‑point cut, with Chair Powell signalling further reductions may not be imminent and traders trimming December cut odds into the mid‑60% range, which has lifted Treasury yields. That policy ambiguity has driven partial flows into the dollar, short‑term bonds and defensive equity sectors even as a high share of S&P 500 firms have beaten earnings. Separately, a recent U.S.–China understanding to pause some export controls and tariffs has eased trade tensions, but markets remain focused on incoming ADP, ISM PMIs and other private indicators for fresh direction.