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Source: Newsmaker.id
The United States (US) dollar weakened again in trading on Thursday (October 29, 2026), as investors assessed decisions by the Federal Reserve and the European Central Bank (ECB) to keep their respective benchmark interest rates unchanged. The US Dollar Index (DXY), which measures the greenback’s strength against six major currencies, fell 0.2% to 102.02 during the New York trading session. Conversely, the euro rose slightly by 0.1% against the US dollar to 1.1162, while the Pound Sterling climbed 0.3% to 1.3361, marking its second consecutive session of gains. These movements reflect a shift in investor sentiment following central bank decisions that were largely in line with market expectations.
The Federal Open Market Committee (FOMC) voted 10 to 2 to maintain interest rates within the 3.75%–4.00% range. Two Fed officials, Lisa Cook and Beth Hammack, favored a 25-basis-point hike, signaling that there remains some pressure for monetary tightening amid ongoing inflationary concerns in the United States.
Meanwhile, the ECB also kept its three key interest rates unchanged, with the deposit facility rate remaining at 2.50%. This decision comes as rising energy prices continue to pose inflationary risks for the Eurozone. Neither central bank provided clear guidance on their next policy moves, leaving investors to weigh the possibility of further interest rate hikes in December.
In the UK, the Pound Sterling found support after the government announced a new budget that appears to maintain fiscal discipline, avoiding any increase in borrowing without a clear source of funding. UK Chancellor of the Exchequer John Healey has set aside a fiscal buffer of £15 billion for the 2029/2030 fiscal year, a move that aligns with market participants' expectations. The policy has helped alleviate investor concerns regarding the UK government's financial stability and has bolstered sentiment toward the pound sterling.
Nevertheless, the future trajectory of the US dollar will continue to be influenced by inflation trends, the Federal Reserve's monetary policy outlook, and diverging interest rate expectations among the United States, the Eurozone, and the UK. With inflationary pressures from energy costs yet to fully subside, the foreign exchange market is expected to remain sensitive to shifts in central bank policy outlooks.
Source: Newsmaker.id