The US Dollar Index (DXY), which tracks the performance of the greenback against six major peers, is consolidating near 98.20 during Thursday’s Asian session after slipping in the previous day’s trade.
The Dollar is finding support ahead of fresh US labor market data that could influence the Federal Reserve’s policy outlook. Traders await the ADP Employment Change report—expected to show slower hiring—alongside weekly Jobless Claims, which are forecast to edge higher. The ISM Services PMI will also be closely monitored for further direction.
Looking ahead, attention will turn to Friday’s Nonfarm Payrolls report. Economists expect the US economy to add roughly 75,000 jobs in August, with the Unemployment Rate projected at 4.3%.
Signs of labor market weakness are already weighing on sentiment. The July JOLTS Job Openings report showed vacancies slipping to 7.18 million from 7.35 million in June, the lowest since September 2024 and below expectations of 7.4 million. This data fueled expectations of a Fed rate cut in September, with the CME FedWatch Tool now pricing in over a 99% chance of a 25-basis-point reduction, compared with 92% the day before.
Comments from Federal Reserve officials added nuance to the outlook. Minneapolis Fed President Neel Kashkari warned that higher tariffs are pushing up consumer costs and inflation, though he noted the economy appears to be moving toward a “soft landing.” Atlanta Fed President Raphael Bostic, meanwhile, emphasized that inflation remains the central risk but signaled scope for just one quarter-point cut this year.
In Washington, Stephen Miran, a member of the US Council of Economic Advisors nominated to the Fed’s Board of Governors by President Donald Trump, pledged to preserve the central bank’s independence if confirmed. He underscored that his views would be guided by analysis, despite his history of unconventional publications.
