Alan Schein Photography | The Image Bank | Getty Images<\/p>\n
The\u00a0U.S.\u00a0dollar\u00a0declined for a second consecutive day on Thursday as data showed weakness in the\u00a0U.S.\u00a0labor market, increasing expectations of another rate cut this year.<\/p>\n
Meanwhile, sterling rose after the\u00a0Bank of England\u00a0kept rates unchanged ahead of this month’s budget. The central bank had been expected to leave rates unchanged, although markets had attached a one-in-three chance of a cut earlier on.<\/p>\n
U.S.-based employers cut more than 150,000 jobs in October, marking the biggest reduction for the month in more than 20 years, a report by Challenger, Gray & Christmas said on Thursday as industries adopt AI-driven changes and intensify cost cuts.<\/p>\n
Economic data from private sources has drawn increased investor interest amid the absence of official data during the\u00a0U.S.\u00a0government’s longest-ever shutdown.<\/p>\n
Thursday’s weakness for the\u00a0dollar\u00a0follows a strong rally that started last week after the\u00a0Federal Reserve\u00a0tempered expectations for additional cuts this year amid limited economic data, persistent inflation, and internal disagreement among policymakers.<\/p>\n
“The move lower in the\u00a0dollar\u00a0this morning was largely anticipated,”\u00a0Antonio Ruggiero, FX & macro strategist at\u00a0Convera, said.<\/p>\n
“The lack of data from the government shutdown led investors to inflate optimism around the\u00a0U.S.,” he said.<\/p>\n
“When figures like the Challenger layoff report emerge, they easily trigger fear among investors who remain unconvinced about the durability of improved USD sentiment. That’s enough to prompt position unwinds, driving the\u00a0dollar\u00a0lower,” Ruggiero said.<\/p>\n
Traders now see a 69% probability of a December rate cut, up from 62% the previous day, according to CME FedWatch. However, this remains well below the roughly 98% odds priced in late October.<\/p>\n
The euro rose 0.5% against the\u00a0dollar\u00a0to\u00a0$1.1546, while the\u00a0dollar\u00a0slipped 0.5% to 99.71 against a basket of major rivals, including the common currency.<\/p>\n
The\u00a0dollar\u00a0fell 0.7% against the yen to\u00a0153.08 yen\u00a0, pulling back from the near nine-month high of\u00a0154.48 yen\u00a0touched on Tuesday.<\/p>\n