As of October 28, 2024, the U.S. dollar remains stable, poised for a significant monthly gain of approximately 4%, the largest increase since April 2022. The Dollar Index, which measures the greenback against six other currencies, stood at 104.147.
This uptick is attributed to rising expectations for smaller U.S. interest rate cuts, supported by robust economic indicators. Upcoming economic reports, including U.S. GDP data on Wednesday and the monthly jobs report on Friday, are anticipated to influence market sentiment.
Analysts predict that job growth will slow to about 111,000 for October, impacted by strikes and weather disruptions from recent hurricanes.
The Federal Reserve has indicated plans to implement a 25 basis point rate cut in November, following a 50 basis point reduction in September. However, this week’s data could affect the Fed's decision-making.
The dollar's strength is also linked to speculation regarding former President Donald Trump’s potential return to the White House, with the election just a week away.
In corporate news, key earnings reports from major companies, including Alphabet, Microsoft, Meta Platforms, Apple, and Amazon, are scheduled for release this week.
In European markets, the euro is on track for a monthly decline of around 3%, trading at 1.0819 against the U.S. dollar. The European Central Bank has cut rates three times this year, with expectations for further reductions if eurozone inflation remains below the 2.0% target.
The British pound has also seen fluctuations, trading at 1.2973, as the new Labour government prepares to unveil its first budget amid concerns over public spending and tax policies.
Meanwhile, the Japanese yen has weakened, reaching a three-month low following parliamentary elections that resulted in a lack of majority for the ruling coalition, raising concerns about political stability in Japan.