The US Dollar Index (DXY) has pulled back slightly, as investors digest mixed economic data and assess the implications for future Federal Reserve policy.
Key Factors:
- US Economic Data: While the PCE Price Index showed some cooling in inflationary pressures, the strong Jobless Claims data suggests a resilient labor market.
- Federal Reserve Expectations: The market is still pricing in a 25 basis point rate cut in November, but the pace of future rate cuts remains uncertain.
- Global Economic Outlook: Geopolitical tensions and concerns about a potential global economic slowdown are also influencing currency markets.
Technical Analysis:
- Downward Pressure: The DXY is facing downward pressure, with potential for further declines.
- Support Levels: The 103.90 level is a key support level.
- Resistance Levels: The 104.55 and 105.20 levels are potential resistance levels.