US Dollar Steadies Amid Weak Job Data, Euro Slumps on French Turmoil

The U.S. dollar stabilized after hitting seven-week lows amid market anticipation of key labor and inflation data that could confirm a Federal Reserve rate cut next week. Recent U.S. employment data revisions are expected to reduce job counts by up to 800,000, raising concerns about the true health of the labor market and increasing expectations for earlier and more aggressive Fed easing. This uncertainty has weakened the dollar, benefiting currencies like the euro, yen, Australian dollar, and British pound, despite ongoing political challenges in France, Japan, and the UK. The weak August U.S. payrolls report and downward revisions to prior months have heightened speculation that the Fed may undertake multiple rate cuts through the end of the year. In contrast, the Bank of England is unlikely to cut rates soon due to persistent inflation, giving sterling an advantage against the dollar. Market participants continue to watch for upcoming U.S. inflation data and political developments as they navigate growing volatility and uncertainty in global currency markets.