Dollar “Calms” Above 99, Markets Await Fed Move
The US dollar held steady above the 99 level on Thursday, after experiencing sharp swings in recent days. Market participants are now refocusing on weighing the direction of the Federal Reserve's interest rate policy amid a combination of the latest economic data and the central bank's independence.
Data-wise, US producer inflation (PPI) accelerated slightly in November, while previous releases indicated relatively tame consumer inflation. At the same time, November retail sales also rose stronger than expected, signaling that consumption remains quite solid and the economy has not weakened drastically.
On the political front, President Donald Trump stated that he has no plans to fire Fed Chairman Jerome Powell, despite the threat of indictment from the Department of Justice. This statement helped ease market concerns that political pressure could undermine the Fed's independence.
Regarding monetary policy, market consensus still expects the Fed to hold interest rates at this month's meeting. Interest rate futures indicate the market is starting to price in two cuts, expected to begin around June, although the path remains highly dependent on subsequent data.
Meanwhile, market attention is also divided between geopolitical and trade issues. Trump signaled a possible delay in action against Iran, but still signed trade agreements related to critical minerals and AI chips—keeping global sentiment sensitive to headlines.
Key Points:
- The dollar stabilized above 99 after high volatility earlier in the week.
- The PPI data edged higher; consumer inflation had previously tended to ease.
- Retail sales rose above expectations, indicating that consumption remains strong.
- Trump said he would not fire Powell, calming concerns about the Fed's independence. (asd)
Source: Newsmaker.id
