Dollar Takes a Breather Before the Economic Storm
Yesterday, the U.S. dollar eased off its recent gains like a sailor letting loose a stubborn sail before a storm. Traders now look toward three big-ticket items: the PCE price index, the second estimate of Q3 GDP growth, and initial jobless claims. Each of these could send the currency dancing or stumbling.
Durable Goods: The Sneak Peek into the Economy
Durable goods orders are also on the radar. A bump or a slump could tell us whether the U.S. economy is still strong or starting to wobble. Keep your eyes on that data.
Inflation Still Over the Roof
Inflation keeps running beyond the Fed’s 2% target, and it’s forcing policymakers to be a bit more cautious.
- During the last FOMC meeting, the minutes were clear: a slower pace for rate cuts.
- Traders are putting a 65% chance on a 25‑basis‑point cut in December.
- If the PCE comes in softer than expected, the dollar might lose some of its bullish spark.
Trump’s Tariffs Reignite the Inflation Fire?
Trump’s latest play—new tariffs on China, Mexico, and Canada—could freshen up inflation. Coupled with the Fed’s caution, markets might be betting that the central bank will keep rates steady through January 2025. A holding pattern often keeps the dollar on a firmer footing.
Tomorrow’s Numbers Might Make the Dollar Wild
Should new reports hint at a slowdown or a surge in unemployment claims, volatility could climb. Fend off the chill‑proofs of the market and stay ready, because the currency could behave like a snowball—quickly gaining speed and crashing sooner than you anticipate.
