Overview

• The dollar index rose slightly on Friday but is set for a weekly fall of about 0.5% as bearish sentiment takes hold.
• Fed funds futures show roughly a 90% chance of a September rate cut and nearly 60 basis points of easing priced in by year-end.
• A weak July jobs report and softer housing and services data have reinforced expectations of a slowing U.S. economy.
• Political moves on Fed leadership, including Stephen Miran’s temporary governor nomination and Christopher Waller’s emergence as a chair candidate, have spurred autonomy concerns.
• Trump’s introduction of a 100% tariff on semiconductor imports and higher duties on other goods has added further uncertainty to the dollar’s outlook.