US Dollar Steady as Investors Await Rate Cuts

The U.S. dollar remained close to its lowest level in over a year, while traders anticipated signals regarding an expected interest rate cut by the Federal Reserve next month. The dollar index was slightly higher at 100.67 but is poised for its biggest monthly decline since November 2022, having fallen over 3% this month. Investors are leaning towards a Federal Reserve rate cut, with a notable debate on whether it will be a substantial 50 basis points or a smaller 25 basis points cut, with current predictions showing a 36% chance of the larger cut. Meanwhile, Bitcoin experienced a significant drop of over 6% after breaking below the $60,000 support level, and the Australian dollar reached multi-month highs due to stronger domestic consumer pricing data. With a preliminary estimate of U.S. GDP and the Fed's preferred inflation measure due soon, market focus is shifting from inflation to economic strength, making the upcoming data critical. Analysts suggest that a strong upside surprise would be necessary to challenge expectations of multiple Fed cuts.